Identity Thief Steals Bay Area Couple’s Tax Refund

Will and Gracie Tan suffered through identity theft, fake credit cards in their name, had their bank accounts raided and then learned that their tax refund was going to someone else, as Ken Garcia recently reported in the San Francisco Examiner. The Tans’ horrible experience illustrates how much damage sophisticated identity thieves can inflict upon consumers’ credit–and their bank accounts–with a few key items of identification.

The Tans’ problems seems to have started last year, when they refinanced their mortgage. Garcia’s column doesn’t say who actually stole their identifying information, only that a ring of thieves in El Paso, Texas ended up with it. Those thieves knew what they were doing–they promptly opened new fraudulent credit card accounts and stole $5,000 from the Tans’ checking account. Apparently because the Tans were diligent in monitoring their bank accounts, they were able to get a refund from the Bank of America. They also had a lucky break in discovering that Macy’s said they owed $1,500 that they hadn’t charged, which led to their discovery that other fraudulent accounts had been opened in their name. But then they learned from the IRS that a tax refund was on the way, and they hadn’t filed yet.

According to Garcia, The Examiner reported recently that the number of fraudulent tax filings is on a steady rise, with tax cheaters using computers to create fake W-2 forms that IRS officials admit are nearly identical to the real thing. IRS officials and tax preparers say 2007 may be a banner year for tax fraud. Worse, once a fake tax return has been filed, consumers are unable to file their legitimate tax return electronically. This creates a bureaucratic nightmare for consumers, especially when they are expecting refunds which they discover are being sent to someone else.


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