Questionable Refund Program (QRP) - Criminal Investigation (CI)
The Questionable Refund Program (QRP) is a nationwide multifunctional program established in January 1977. The QRP was designed to identify fraudulent returns, to stop the payment of fraudulent refunds and to refer identified fraudulent refund schemes to Criminal Investigation (CI) field offices.
Questionable Refund Detection Teams (QRDT) are located in the CI Scheme Development Centers (SDCs) located on each of the ten IRS campuses, where individual tax returns are filed and processed. However, the QRP business return detection efforts take place at the Cincinnati and Ogden SDCs only. The QRDT reviews questionable tax returns that have been identified by manual or computerized screening techniques. Schemes with criminal potential are referred to CI field offices for investigation. In addition, many returns are referred to other IRS Operating Divisions as well as to the adjustments section for appropriate civil action.
QRP schemes are also detected through communications from electronic return originators, financial institutions, return preparers, and concerned citizens.
The Electronic Fraud Detection System is a Criminal Investigation (CI) computer system that automates the computer identification output for potentially fraudulent electronic filed tax returns, increases data available for analysis, and assists in the development of information relating to paper and ELF schemes detected by the QRDTs.
The filing of questionable claims for refund is also associated with the crime of identity theft. On October 30, 1998, The Identity Theft and Assumption Deterrence Act of 1998, hereinafter referred to as the Act, went into effect. Section 3 of the Act amends Title 18 U.S.C. § 1028 by, among other things, adding new Subsection (a)(7). This subsection establishes an offense by anyone who:
Knowingly transfers or uses, without lawful authority, a means of identification of another person with the intent to commit, or to aid and abet, any unlawful activity that constitutes a violation of federal law, or that constitutes a felony under any applicable state or local law.
Title 18 U.S.C. § 1028(d)(3) defines "means of identification" as any name or number that may be used, alone or in conjunction with any other information, to identify a specific individual. It covers several examples, such as name, social security number, and government-issued driver’s licenses.
Criminal Investigation can investigate and recommend prosecution under this statute in tandem with the investigation of substantive tax and money laundering violations emanating from refund fraud and money laundering schemes.
In the context of tax crimes, Title 18 U.S.C. § 1028 could be applicable where a defendant steals another person’s identity for the purpose of falsely representing their identity to the Internal Revenue Service. The issue is most likely to occur in the QRP area where individual identities are stolen with the intent to file false tax returns claiming tax refunds.
Questionable Refund Program (QRP) enforcement statistics on investigations initiated, prosecutions recommended, indictments, sentenced investigations and months to serve in prison.
Examples of Questionable Refund Investigations
Examples are written from public record documents filed in the district courts where the case was prosecuted.