Cyber Thieves Hit the IRS—and 100,000 Taxpayers

Identity thieves hacked into an Internal Revenue Service data system earlier this year, potentially gaining access to personal financial information for at least 100,000 taxpayers.
The IRS issued a statement today saying that its online system, “Get Transcript,” was breached between February and May, the Associated Press first reported. The portal possesses information including tax returns and other taxpayer data stored by the IRS.
Related: Tax Thieves Could Boost Their Income by 262 Percent
The IRS’s statement said the tax thieves were able to penetrate the system because they had knowledge of 100,000 taxpayers, including dates of birth, Social Security numbers and tax filing details.
The massive hack comes as identity theft is at a record high. Earlier this year, the Treasury Inspector General for Tax Administration (TIGTA) reported that 1.6 million taxpayers were affected by identity theft in 2014 – compared to just 271,000 in 2010.
The IRS’s ability to catch fraudsters was even added to the GAO’s “High Risk List” or the list of federal programs that are most-vulnerable to waste, fraud and abuse.
Auditors attribute the increase to the uptick in electronic filing, which is more convenient for tax filers, but also easier for fraudsters to file fake returns.
TIGTA says the IRS doled out more than $5.8 billion in fraudulent refunds related to identity theft during the 2013 filing season.
The shift to electronic filing is also apparently making taxpayer information even more vulnerable according to the latest breach.
Related: IRS Struggles to Help Victims of Identity Fraud
The hack is obviously bad news for the agency, which is already struggling to address cases of identity theft as they stack up. TIGTA reported the IRS took about 278 days on average to resolve identity theft cases in 2013, despite the agency claiming that it takes about 180 days or six months to resolve issues of identity theft.
When it does complete cases, the IG found that about 10 percent of the “resolved” were riddled with errors.
The latest report comes at a tough time for the IRS, which is struggling with a recent round of budget cuts and is operating with an even greater workload while enforcing at least 40 new tax provisions under the president’s health care law.
The agency said it has temporarily suspended the online service that was the subject of the breach until the vulnerabilities are resolved.
Top Reads from The Fiscal Times:
- Mike Huckabee and His Tax Plan Get Slammed on Fox
- Putin Isn’t Reviving the USSR, He’s Creating a Fascist State
- States Band Together To Keep Obamacare Afloat
Diamond Prices Are Falling, but Don’t Rush to Buy an Engagement Ring

Diamond prices are getting slashed, but that doesn’t mean you should run out to the jewelry store right now.
De Beers, the world’s largest producer and distributor of diamonds by value, is cutting diamond prices by as much as 9 percent, according to Bloomberg.
Diamond prices have already slumped over the past year as demand has fallen, partly as a result of the economic slowdown in China, the second-biggest market for the precious stones.
Related: Can Gold Regain Its Shine?
De Beers, which is a unit of mining giant Anglo American and controls one-third of the global diamond market, initially tried to stabilize prices by ramping down its production. It had started the year with a production goal of 34 million carats, but has twice slashed the goal to a current 29 million to 31 million carats.
That hasn’t been enough to counterbalance sagging demand, so De Beers says it will invest in a holiday marketing campaign in an attempt to boost consumer interest. The campaign will be focused in the U.S. and China, the world’s two leading diamond markets, and will primarily target men buying diamond jewelry gifts for their partners.
In other words, you can expect to see a whole lot of diamond commercials soon — and in an interview with The Fiscal Times, one diamond industry expert predicted that the industry’s struggles will lead at least some retailers to cut prices this holiday season.
Related: Putin’s Spokesman Wears a Golden Skull Watch Worth $620K
The De Beers price cuts probably won’t have much effect on prices at high-end jewelry retailers such as Tiffany’s, though. These stores only purchase gems from a limited number of producers and since the diamonds they use are higher in value, their prices aren’t as vulnerable to market pressures as less valuable stones.
But it never hurts to look, right?
Top Reads from The Fiscal Times:
- Why You Should Ignore the Stock Market Sell-Off
- The 10 Worst States for Property Taxes
- The Best Things to Charge on Your Credit Card
Americans Are Happier with This Car Brand Than Any Other

Americans may love their cars, but these days they love them a little less.
Consumer satisfaction with their cars has fallen for the third consecutive year, reflecting unhappiness with increasing recalls and rising prices, according to new data from the American Customer Satisfaction Index.
Car reliability has improved overall in the past decade but the number of recalls is at an all-time high. “This should not happen with modern manufacturing technology and has negative consequences for driver safety, costs, and customer satisfaction,” ACSI Chairman and founder Claes Fornell said in a statement.
Car owners in the second quarter of 2015 reported a 40 percent increase in recalls year over year. The most high profile recalls involve Takata airbags, affecting more than 17 million older-model vehicles built by 11 different auto makers.
Related: Senators Urge Recall of All Vehicles with Takata Airbags
Looking at individual brands, the index shows that Americans prefer Japanese and luxury brand cars, with Lexus displacing Mercedes Benz as the brand with the highest overall satisfaction (84 out of 100). Mercedes tied for second place with Acura and Lincoln.
The average for all autos fell 3.7 points to 79. The only American automaker to rank above average was Ford with a score of 81. General Motors and Chrysler saw their scores fall modestly to 79 and 75 respectively.
Despite a growing decline in satisfaction, Americans are holding onto their vehicles longer than ever. The average age of cars and light trucks is now 11.5 years old, according to a report issued last month by IHS Automotive.
Top Reads from the Fiscal Times:
- Big Surprise: Hispanic Voters Can’t Stand Donald Trump
- How a Biden-Warren Ticket Could Transform the Campaign
- Air Force Brushes Off $27 Billion Accounting Error
Watch Chris Christie Play the Enforcer in His Latest Ad
New Jersey Gov. Chris Christie’s presidential campaign has adopted “Telling It Like It Is” as its slogan and, according to his latest national television ad, he wants to tell voters just how scary the world is today.
The 30-second spot, titled “Law Enforcer,” opens with Christie decrying “lawlessness in America and around the world under Barack Obama.”
He rattles off a series of threats, speaking over dramatic music cues and flashing images.
Related: As Stocks Tank, Trump Warns China Could ‘Bring Us Down’
“Sanctuary cities engulfing Americans in crime. Drugs running rampant and destroying lives. ISIS beheading Christians. Iranian radicals with nuclear weapons,” he says ominously.
“Now, Hillary Clinton thinks the law doesn't apply to her,” Christie asks as images of a computer server appear on screen. “Really?”
The former U.S. attorney argues that the country needs a “strong law enforcer as president, someone who says what he means and means what he says.”
The doom and gloom ad, featuring a score more typical of a television drama than a presidential ad, is running on the Fox News Channel and marks Christie’s latest attempt to spark interest in his White House bid.
The two-term governor has consistently lost support in opinion polls since the inaugural GOP presidential debate, while political outsiders like Donald Trump, Ben Carson and Carly Fiorina have surged.
Related: Rand Paul Gets a Break in Kentucky, but It’s Going to Cost Him
Last week a CNN/ORC survey put Christie in 11th place, garnering only three percent support among GOP voters.
If the trend continues, Christie could lose his spot on the main stage at the CNN/Reagan Library debate on September 16 and relegated to the second-tier.
Top Reads from the Fiscal Times:
- Democrats Are Openly Speculating About an Election without Hillary Clinton
- Scott Walker Adjusts His Immigration Stance. Again
- The 10 Best States for Property Taxes
How to Cut Your Homeowner’s Insurance in Half

That lousy credit score is costing you more than a good rate on a loan.
Insurance premiums for homeowners with excellent credit are half the price of premiums for homeowners with poor credit, according to a new report by insuranceQuotes.com. Homeowners with median credit pay about a third more than those with excellent credit.
The difference in premiums varies by state, with homeowners with poor credit in 38 states paying at least twice as much those with excellent credit. Homeowners in West Virginia have the biggest premium gap, with those with poor credit paying more than three times what homeowners with excellent credit pay.
Homeowners in Washington, D.C., and Ohio had the next highest gap in premiums (185 percent), followed by Montana (179 percent).
Related; The Easiest Way to Cut Your Home Insurance Premiums
In general, insurers are putting a higher emphasis on credit scores than they did last year, with scores having a bigger impact this year than last in 29 states. “It’s more important than ever to maintain a solid credit rating by paying their bills on time, keeping their balances low, and correcting errors on their credit reports,” Laura Adams, insurangeQuotes.com senior analyst said in a statement.
California, Massachusetts and Maryland do not allow insurers to consider credit in setting prices, and insurers in Florida don’t use it.
The average U.S. homeowner’s insurance premium is around $950. In addition to making an effort to boost their credit, homeowners should shop around every few years to see if they can find a better rate.
Top Reads from the Fiscal Times:
- The 10 Best States for Property Taxes
- Democrats Are Openly Speculating About an Election without Hillary Clinton
- California’s Latest Nightmare: San Joaquin Valley Is Sinking
Dow Sheds Nearly 600 Points, S&P 500 in Correction in a Wild Day on Wall Street

U.S. stocks plunged more than 3.5 percent on Monday, closing off session lows in high volume trade as fears of slowing growth in China pressured global markets.
S&P 500 ended nearly 80 points lower, off session lows of about 104 points lower but still in correction territory after the tech sector failed intraday attempts to post gains. Cumulative trade volume was 13.94 billion shares, the highest volume day since Aug. 10, 2011.
The major averages had a volatile day of trade, plunging sharply in the open and more than halving losses to trade less than 1 percent lower on the day, before closing down more than 3.5 percent.
"I think we probably rallied too fast. A lot of people that covered their shorts got their shorts covered," said Peter Coleman, head trader at Convergex. He noted the Dow was still trading several hundred points off session lows and that a close better than 500 points lower would be a good sign.
Related: The Stock Market's Fed Fever Is Only Going to Get Worse
"The market's going to be focused on China tonight to see if they come on tonight with something that would be considered a viable (way) to stimulate growth in that economy," said Quincy Krosby, market strategist at Prudential Financial.
The Dow Jones industrial average ended nearly 600 points lower after trading in wide range of between roughly 300 to 700 points lower in the minutes leading up to the close.
In the open, the index fell as much as 1,089 points, making Monday's move its biggest intraday swing in history. In midday trade, the index pared losses to trade about 110 points lower.
The blue-chip index posted its biggest 3-day point loss in history of 1,477.45 points.
During the first 90 minutes of trade, the index traveled more than 3,000 points in down and up moves.
"I'm hoping for some stability here but I think markets remain very, very vulnerable to bad news (out of) emerging markets," said Dan Veru, chief investment officer at Palisade Capital Management.
He attributed some of the sharp opening losses to exchange-traded funds. "It's so easy to move a bajillion dollars in a nanosecond."
Trading in stocks and exchange-traded funds was paused more than 1,200 times on Monday, Dow Jones said, citing exchanges. Such pauses total single digits on a normal day, the report said. An increase or decline of five percent or more triggers a five-minute pause in trading, Dow Jones said.
The major averages came sharply off lows in midday trade, with the Nasdaq off as low as less than half a percent after earlier falling 8.8 percent. Apple traded more than 1.5 percent lower after reversing losses to briefly jump more than 2 percent.
"There was sort of a lack of follow-through after the morning's crazy action in the overall market," said Robert Pavlik, chief market strategist at Boston Private Wealth. "The selling really dissipated once we got to around 10 o'clock."
He attributed some of the late morning gains to a short squeeze and bargain hunting.
Art Hogan, chief market strategist at Wunderlich Securities, noted that the sharp opening losses were due to great uncertainty among traders and the implementation of a rare market rule.
The New York Stock Exchange invoked Rule 48 for the Monday stock market open, Dow Jones reported.
The rule allows NYSE to open stocks without indications. "It was set up for situations like this," Hogan said. The rule was last used in the financial crisis.
Stock index futures for several major indices fell several percentage points before the open to hit limit down levels.
Circuit breakers for the S&P 500 will halt trade when the index decreases from its previous close by the following three levels: 7 percent, 13 percent, and 20 percent.
"Fear has taken over. The market topped out last week," said Adam Sarhan, CEO of Sarhan Capital. "We saw important technical levels break last week. Huge shift in investor psychology."
"The market is not falling on actual facets of a sub-prime situation. It's falling on fear of the unload of China. That's really behind this move," said Peter Cardillo, chief market economist at Rockwell Global Capital.
The CBOE Volatility Index (VIX), considered the best gauge of fear in the market, traded near 40. Earlier in the session the index leaped above 50 for the first time since February 2009.
"When the VIX is this high it means there's some panic out there," said Randy Frederick, managing director of trading and derivatives at Charles Schwab.
However, he said with stocks more than halving losses he "wouldn't be surprised if we closed positive." "If you could move it that far you could move it another 350 points" on the Dow," he said.
Overseas, European stocks plunged, with the STOXX Europe 600 down more than 5 percent, while the Shanghai Composite dropped 8.5 percent, its greatest one-day drop since 2007.
Treasury yields came off session lows, with the U.S. 10-year yield at 2.01 percent and the 2-year yield at 0.58 percent.
The U.S. dollar fell more than 1.5 percent against major world currencies, with the euro near $1.16 and the yen stronger at 119 yen versus the greenback.
A U.S. Treasury Department spokesperson said in a statement that "We do not comment on day-to-day market developments. As always, the Treasury Department is monitoring ongoing market developments and is in regular communication with its regulatory partners and market participants."
The Dow transports ended more than 3.5 percent lower to approach bear market territory.
About 10 stocks declined for every advancer on the New York Stock Exchange, with an exchange volume of 901 million and a composite volume of 4 billion as of 2:05 p.m.
Crude oil futures settled down $2.21, or 5.46 percent, at $38.24 a barrel, the lowest since February 2009. In intraday trade, crude oil futures for October delivery fell as much as $2.70 to $37.75 a barrel, a six-and-a-half-year low.
Gold futures settled down $6.10 at $1,153.60 an ounce.
This post originally appeared on CNBC. Read More at CNBC:
- Wharton's Siegel: We're going to test, possibly break this morning's lows
- Barclays: Fed unlikely to hike before March 2016
- One of Wall St's biggest bulls throws in the towel