Great article from Hesch and Associates company about 3 fraud programs managed by Government:
* Federal Reward Program;
* State Reward Program (21 state adopted law to themselves and more expected);
* Income Tax Reward Program
Congress has authorized DOJ ( Department of Justice) to pay up to 30% of the amount of fraudulent payments recovered back. You can read article here:
Just want to mention results:
Having recovered over $20 billion ;
Paying out nearly $3 billion in rewards to citizens ;
The largest rewards for reporting fraud > $100 million ;
average reward is $1.5 million ;
4% cases get reward by more than $1million;
DOJ accepts 25% of applications;
A reward has been paid to 95% of accepted cases,
But 2 must criterion for cases on IRS Tax Fraud program makes it far from effective:
* Company should hide taxes of $2 millions!
* Person cheating from that company, must have had a gross income of at least $200,000 /1 tax year.
Why? It states that reward program does not want to see it used as a weapon in family or neighborhood squabbles or for smaller tax fraud cases.
Ok. so it means, that:
1) Probably 95% of frauds are not even registered, what impact to crime prevention it gives? 19 of 20 cases are unprevented and can easy risk for 1million, which is still huge money :)
2) Big frauds starts from small frauds.Tree should be bend, while it is young.
Of course it still better than nothing...
I know Government of Lithuania had or maybe still having (just poor informational compaign) one similar Tax Claim Fraud law 5years ago as well. Law promised up to 100 000Lt (up to ~ 29 000Eur) for reported information. Law was administered
FNTT (Finantial Crimes ......
No news about Lithuanian program success, but will be interested how that was going on.
Would be interesting to here from other countries False Claims Act attorneys. Do law gives them enough possibilites to cooperate with people having information and to earn.
Please leave comments below..