    [Senate Hearing 114-283]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 114-283

            SENATE BUDGET COMMITTEE FIELD HEARINGS FISCAL YEAR 2016

    =======================================================================

                                    HEARINGS

                                   BEFORE THE

                            COMMITTEE ON THE BUDGET
                              UNITED STATES SENATE

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

     June 8, 2015-PERSPECTIVE ON BUDGET PROCESS REFORM: S. 1495, FAIRNESS
                         FOR CRIME VICTIMS ACT OF 2015
             August 26, 2015-FIELD HEARING ON TAX-RELATED IDENTITY

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                                   ___________

                            U.S. GOVERNMENT PUBLISHING OFFICE
    97-729                          WASHINGTON : 2016
    _______________________________________________________________________________________
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                            COMMITTEE ON THE BUDGET

                       MICHAEL B. ENZI, WYOMING, Chairman

    CHARLES E. GRASSLEY, Iowa            BERNARD SANDERS, Vermont
    JEFF SESSIONS, Alabama               PATTY MURRAY, Washington
    MIKE CRAPO, Idaho                    RON WYDEN, Oregon
    LINDSEY O. GRAHAM, South Carolina    DEBBIE STABENOW, Michigan
    ROB PORTMAN, Ohio                    SHELDON WHITEHOUSE, Rhode Island
    PATRICK TOOMEY, Pennsylvania         MARK R. WARNER, Virginia
    RON JOHNSON, Wisconsin               JEFF MERKLEY, Oregon
    KELLY AYOTTE, New Hampshire          TAMMY BALDWIN, Wisconsin
    ROGER F. WICKER, Mississippi         TIM KAINE, Virginia
    BOB CORKER, Tennessee                ANGUS S. KING, JR., Maine
    DAVID A. PERDUE, Georgia

                     Eric Ueland, Republican Staff Director

                    Warren Gunnels, Minority Staff Director

                                      (ii)

                                C O N T E N T S

                                   __________

                                    HEARINGS

                                                                       Page

    June 8, 2015-PERSPECTIVE ON BUDGET PROCESS REFORM: S. 1495,
      FAIRNESS FOR CRIME VICTIMS ACT OF 2015.........................     1

    August 26, 2015-FIELD HEARING ON TAX-RELATED IDENTITY............    55

                        STATEMENTS BY COMMITTEE MEMBERS

    Chairman Enzi
    Ranking Member Sanders

                                   WITNESSES

    Peg, J. Dierkers, Ph.D, Executive Director, PA Coalition Against
      Domestic Violence

    Honorable J. Russell George, Inspector General for Tax
      Administration, Department of the Treausy

    Honorable John A. Koskinen, Commissioner, Internal Revenue
      Service

    Chistropher Lee, Senior Attorney Advisory, National Taxpayer
      Advocate Service

    Diane Moyer, Legal Director, PA Coalition Against Rape

    Abbie Newman, RN, Executive Director and Chief Executive Officer,
      Mission Kids Child Advocacy Center of Montgomery County, PA

    John C. Walker, Enrolled Agent, J. Walker and Company, LLC

    Lori Weeks, Straford, Tax-Related Identity Theft Victim

    John Whelan, District Attorney, Delaware County, PA

                             QUESTIONS AND ANSWERS

    Questions and Answers

      PERSPECTIVES ON BUDGET PROCESS REFORM: S. 1495, FAIRNESS FOR CRIME
                              VICTIMS ACT OF 2015

                                  ----------

                              MONDAY, JUNE 8, 2015

                                  United States Senate,
                                       Committee on the Budget,
                                                       Washington, D.C.
        The committee met, pursuant to notice, at 10:00 a.m., in
    the Martin G. McGuinn 67 Ceremonial Courtroom, Second Floor,
    Villanova University School of Law, 299 North Spring Mill Road,
    Villanova, Pennsylvania, Honorable Pat Toomey, presiding.
        Present: Senator Toomey.
        Staff Present: Adam Kamp, Chief Clerk; and Gregory Dean,
    Republican Chief Counsel.

                  OPENING STATEMENT OF SENATOR TOOMEY

        Senator Toomey. Good morning. I will call to order this
    hearing of the Budget Committee of the United States Senate.
        I want to, first of all, welcome everyone for being here,
    for joining us this morning. I want to thank our witnesses. I
    will provide an introduction and more formal acknowledgement
    and thanks in just a minute, but I really appreciate your being
    here and making this possible. And, a big thanks to our host,
    the Villanova Law School. I really, really appreciate their
    willingness to provide an outstanding facility so that we can
    do this.
        Just for your information, I am a member of the Senate
    Budget Committee and the committee has rules that permit
    individual members to have field hearings across their
    respective states, but it is unusual to do it. It has to be
    approved by the leadership of the committee. And, this is the
    first field hearing that I have done since I have joined the
    Senate and joined the Budget Committee. But, I have chosen this
    topic because I feel very, very strongly about it. I think the
    problem that we are going to discuss this morning and the
    remedy that we have developed is really very, very important,
    and I hope that through the discussion this morning we will be
    able to shed some light on this and call some attention to the
    situation that we face. So, thank you for helping us to
    accomplish that.
        The fact is, every single year, victims of child abuse,
    sexual assault, domestic violence, and other crimes do not
    receive the full services that they need. The fact is, abused
    children sometimes wait weeks before they can receive the full
    medical and emotional services that they need. There are rape
    victims who are not able to obtain the medication that can
    prevent them from contracting HIV/AIDS. There are victims
    fleeing domestic abuse who are unable to find beds for
    themselves and their children.
        And, this does not have to happen this way. Every year, the
    federal government takes hundreds of millions of dollars,
    sometimes billions of dollars, that under federal law are
    required to go to the victims of crime and the government
    instead diverts those monies to other discretionary spending
    programs. And, none of this money comes from taxpayers in the
    first place.
        So, you are probably asking yourselves, how can this
    happen? Well, it happens through the Crime Victims Fund, and I
    am going to describe this. Back in 1984, Congress created the
    Crime Victims Fund based on a simple principle, and the
    principle is that money that the federal government collects
    from those convicted of crimes should be used to help those who
    are victims of crime. The Crime Victims Fund receives no
    taxpayer dollars at all. It is funded entirely by criminal
    fines and penalties collected in federal courts.
        So, even though money deposited in the Crime Victims Fund
    is supposed to be used only to assist crime victims, for over a
    decade, Congress has withheld billions of dollars from victims
    and instead used that money to offset other discretionary
    spending programs.
        For instance, from fiscal years 2010 through 2014, the
    Crime Victims Fund collected $12 billion, but dispersed to
    victims only $3.6 billion. Congress used the $8.4 billion
    difference as an offset for other discretionary spending. And,
    through a budget gimmick, a gimmick in the rules by which
    Congress accounts for its spending, Congress represents that
    this money, money that has already been spent, is still
    available to the Crime Victims Fund and, therefore, still
    theoretically available for victims.
        Well, this gimmick is troubling from a transparency point
    of view. It is just dishonest budgeting and it allows Congress
    to under-report the amount of money that is being spent. But
    even more troubling is the problem from the victims' services
    standpoint. As I said, victims of child abuse, sexual assault,
    domestic violence, and other crimes are routinely unable to
    access the help that they need because the funds have not been
    dispersed as they should.
        So, we have made some progress in recent years. I was
    pleased to see, in response to pressure that many of us were
    putting on the appropriations process, the fiscal year 2015
    budget, the Crime Victims Fund allocation was $2.3 billion,
    versus $745 million the previous year. So, we about tripled the
    allocation from the Crime Victims Fund.
        And, in addition, the budget resolution that we just passed
    a couple of months ago, at my insistence, it dramatically
    curtails this gimmick for the next fiscal year. So, in 2016,
    according to our budget resolution, the Crime Victims Fund will
    disperse about $2.5 billion. Again, we are holding--actually
    increasing modestly from last year's level, which is itself
    three times higher than previous years.
        So, what is the impact in Pennsylvania? In 2014,
    Pennsylvania crime victims services organizations received $17
    million. Next year, that will be $70 million. So, it is a big
    increase. It is a good start. It is movement in the right
    direction.
        But, it is only a start because these provisions that
    caused the increase in fiscal year 2015 and 2016, they are
    temporary. They expire when the funding expires. They expire at
    the end of those fiscal years. So, what we need is a permanent
    legislative fix that simply requires that we end this injustice
    and we start allocating the funds in the Crime Victims Fund
    each and every year as the law has always contemplated, but not
    delivered.
        So, to do this, I have introduced a bill. It is called the
    Fairness to Crime Victims Act of 2015. It is S. 1495. And, it
    would provide a permanent fix. The bill would ensure that,
    henceforth, money deposited into the fund goes to crime
    victims, not to other discretionary spending or budget
    gimmicks. It would require specifically that each year, the
    Crime Victims Fund disperse the average of the past three
    years' collections. So, it smooths out the amounts deposited
    into the funds each year. That would be over $2.6 billion for
    2016. I have six cosponsors on my legislation, Senators Ayotte,
    Corker, Crapo, Gardner, Hatch, and Johnson.
        And today, I am grateful that we are joined by four
    advocates for victims of crime, advocates who can inform our
    committee of the needs of crime victims, the way that they
    serve crime victims, and including those victims listed as
    priority groups under the Crime Victims Fund, which are
    specifically the victims of sexual assault, victims of child
    abuse, and victims of domestic violence.
        So, my hope is, again, that we will shine a bright light on
    the true cost of this budgetary gimmickry that Congress has
    undertaken and the true cost is the lost service to crime
    victims who need this service. If we are successful in shining
    that light, it is my hope that we will build support in the
    Senate Budget Committee. I expect that we will have an
    opportunity to pass this legislation in the committee as soon
    as the next several weeks, and then it will be a fight to get
    this on the Senate floor so that we can pass it into law and
    implement this.
        So, again, big thanks to our witnesses. I am going to
    introduce our--I will introduce each of the witnesses and then
    I will ask for your testimony, and then we will have time for
    some questions at the end.
        Let me start with Jack Whelan. Jack Whelan is the District
    Attorney of Delaware County. Jack has been dedicated to
    criminal justice for decades. Back in the 1980s, when he was an
    Assistant District Attorney in Delaware County and a trial team
    leader, he led the respected law firm of Whelan, Doyle, and
    Pressman. He served two terms as Chairman of the Delaware
    County Council, where he made public safety a top priority.
    Since 2011, when he became the District Attorney for Delaware
    County, Jack has led on several issues, including founding the
    Delaware County Heroin Task Force to raise awareness about
    prescription drugs and heroin abuse.
        He has received many honors from victims' rights groups and
    victim advocacy groups. I am very pleased that in April, the
    Delaware County Children's Advocacy Center had its official
    opening, and I know that the Children's Advocacy Center
    appreciates having a talented and dedicated ally in Jack
    Whelan.
        Next, we will hear from Abbie Newman. Abbie is the
    Executive Director and CEO of Mission Kids Child Advocacy
    Center of Montgomery County, and Abbie has been a tireless
    advocate for children. She began her career as a registered
    nurse practicing pediatrics. But after graduating from law
    school, she in time became the founding Executive Director of
    the Mission Kids of Montgomery County and served as the group's
    Executive Director and CEO to this day. Ms. Newman also served
    as President of the Pennsylvania Chapter of Child Advocacy
    Centers from 2012 to 2014, when she was elected as First Chair
    of the External Affairs Committee of the State Chapter, in
    which position she continues today.
        I want to thank Abbie very much and the other advocates at
    Child Advocacy Centers throughout Pennsylvania. I have had an
    opportunity to tour probably six or eight Child Advocacy
    Centers in Pennsylvania and I have been very, very impressed at
    how devoted these folks are to serving kids who are the victims
    of some of the most horrendous circumstances. They really do a
    wonderful job, and Abbie, I want to thank you for joining us
    today.
        Next, we will hear from Diane Moyer. Diane is the Legal
    Director at the Pennsylvania Coalition Against Rape. Diane is a
    fighter and she has been fighting for victims of sexual assault
    for decades. She served for 18 years as the Legal Director of
    the Pennsylvania Coalition Against Rape, which is the oldest
    anti-sexual violence coalition in the nation. The Pennsylvania
    Coalition Against Rape oversees 50 Rape Crisis Centers in
    Pennsylvania. I had the opportunity to visit one of these, the
    Pittsburgh Action Against Rape Center, and saw firsthand the
    valuable work that they do.
        Diane is a board member of the National Crime Victims Law
    Institute and the National Alliance to End Sexual Violence. She
    has worked on many pieces of legislation to achieve justice for
    victims of sexual assault, including legislation on HIV testing
    of sex offenders, extending civil statute of limitations for
    child sexual abuse, denial of bail for violent predators, and
    many others. Diane has also received awards from numerous
    organizations reflecting the great work that she has done over
    many years, and she has been invaluable in helping to craft the
    Fairness for Crime Victims Act. I appreciate all of your help,
    Diane.
        And then, finally, Peg Dierkers. Peg Dierkers is the
    Executive Director of the Pennsylvania Coalition Against
    Domestic Violence. Peg is dedicated to providing the best, most
    innovative and comprehensive service possible for victims of
    abuse. She has been the Executive Director of the Pennsylvania
    Coalition Against Domestic Violence, which serves nearly
    100,000 victims in Pennsylvania each year, and serves on the
    Victims Services Advisory Committee for the Pennsylvania
    Commission on Crime and Delinquency.
        Peg and her policy advisor, Abigail Hurst, have been very,
    very helpful in drafting the Fairness for Crime Victims Act and
    I look forward to continuing to work with you, Peg, to prevent
    and assist victims of domestic violence.
        So, with that, we will begin our testimony, and first, I
    would like to hear from District Attorney Jack Whelan.

     STATEMENT OF JACK WHELAN, DISTRICT ATTORNEY, DELAWARE COUNTY,
                              PENNSYLVANIA

        Mr. Whelan. Thank you, Senator. I want to start by saying
    it is an honor for me to appear before you today, and I want to
    take the opportunity to thank you for your leadership, not only
    today for the Fairness for Crime Victims Act, but your past
    leadership, for example, as you mentioned, in regard to our
    heroin epidemic here in Delaware County, for your bipartisan
    efforts on the National All Schedules Prescription Electronic
    Reporting Reauthorization Act, as well as what we will be
    talking about a little bit today, the sexual abuse and how you
    were sponsoring the Protecting Students from Sexual and Violent
    Predators Act, all which will be very important in Delaware
    County.
        Unfortunately, we are here in Delaware County and it is
    unfortunate to the extent that we probably are the third
    highest county in the State of Pennsylvania with our crime
    hitting 10,000 cases a year and 4,000 separate juvenile cases.
    So, we are, we believe, statistically speaking, we are third in
    the state. We have the largest District Attorney's Office after
    Philadelphia, Pittsburgh, and then we are third in regard to
    personnel in our efforts to combat crime.
        We are very fortunate, though, that we have advocacy groups
    that we partner with. Those advocacy groups, some of them are
    here today. Joyce Dale is here with us from Women Against Rape,
    and the Family Support Line that is running our Child Advocacy
    Center, Pat Krasinski, and our Domestic Abuse Project. These
    are victim advocacy agencies, nonprofit groups that work on a
    daily basis. They work each and every day to support crime
    victims. We in the District Attorney's Office are fortunate to
    be able to partner with them so that when we are prosecuting
    the case, we know that there is a victim advocate for each and
    every victim of a crime.
        To put it in, I guess, a form of a perspective, if you
    drove here today and you drove and you pulled into Villanova
    University in your vehicle, and when you leave these hearings
    today, if you went out and your car was stolen, that would
    affect you. It is going to seriously inconvenience you. You are
    a victim of a theft, an auto theft, and it is going to bother
    you.
        But one thing I am told by people that have their car
    stolen, although it has not been a devastating crime or a
    devastating impact, each one person that has had their car
    stolen will never forget the fact that they had their car
    stolen, and will never forget the fact that when they left
    Villanova at the Senate committee hearing, that they went out
    and their car was taken from them and the inconvenience that
    they suffered.
        Now, when you look at that with a simple theft crime and
    how you feel victimized, and now you compare that to an
    individual that has been sexually abused, or an individual that
    has been raped, an individual that has been beaten violently,
    these individual victims will never, ever forget. Not only will
    they never forget what happened, but they will never be the
    same when that crime occurs to them. For the rest of their
    life, they will never, ever be the same.
        So, it is critical to have our victim advocacy groups.
    These are groups of individuals that operate 24-hour hotlines
    that the victim can call, even sometimes before the police are
    involved. It is important, because not only do they encounter
    that victim, follow that victim through the criminal justice
    system, they provide services to that victim that no other
    entity can provide, for example, counseling, whether that
    counseling be support groups or psychological counseling. All
    of this is money that is very well spent.
        But, one of the complaints or concerns of all of these
    victims' rights advocacy groups is the fact that we do not have
    enough resources. We can always use more resources to help the
    victims here in Pennsylvania. They do an incredible job, and
    they make ends meet with what they have, but they need more
    resources.
        Recently, as you indicated, the Child Advocacy Center here
    in Delaware County was opened up and they are now still needing
    additional resources to help these children. Unfortunately,
    what we have seen when the Child Advocacy Center opened up is
    an onslaught of individuals that now are being interviewed. We
    have a couple of trained forensic interviewers. One is here
    with us today. However, we need more interviewers. We need more
    people ready and willing to help to deal with these impacts of
    child abuse, because the children deserve more. They deserve to
    be taken care of, into the criminal justice system.
        Many times when we thrust these young victims into a very
    difficult scenario, a situation where they are being placed
    into a courtroom and we are directly examining them, and then
    they are cross-examined, then it becomes difficult. The Child
    Advocacy Center lessens the impact of these individuals. So, it
    is very important.
        We are also happy here in Delaware County that the Internet
    Crimes Against Children Unit is housed right in Delaware
    County, in our Criminal Investigation Division, and that is
    funded by the Department of Justice. And, for many, many years,
    under the leadership of Congressman Meehan, we have been able
    to support that through federal funding and continue to go
    across the State of Pennsylvania, partner with affiliates to
    make sure that children are not being victimized additionally
    with Internet applications.
        So, when we look at different scenarios that occur,
    unfortunately, whether it is rape or it is child abuse or it is
    domestic violence, we are in the throes of all of this and it
    is important that we continue to be advocates of these victims,
    and it is important to make sure that the resources are
    available for all of our victims' groups.
        And, I thank you for having this opportunity to address
    you.
        [The prepared statement of Mr. Whelan follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Toomey. Thank you, D.A. Whelan. Thank you very much
    for your testimony. Your written testimony, I appreciate, as
    well, as I read that last night. That will be submitted for the
    record and I appreciate it.
        Next, Ms. Newman, thank you for joining us. Your written
    testimony also will be submitted to the record, but I invite
    you now to give us your oral testimony.

     STATEMENT OF ABBIE NEWMAN, R.N., EXECUTIVE DIRECTOR AND CHIEF
       EXECUTIVE OFFICER, MISSION KIDS CHILD ADVOCACY CENTER OF
                    MONTGOMERY COUNTY, PENNSYLVANIA

        Ms. Newman. Good morning, Senator Toomey, and thank you. I
    do not think that my voice carries quite as far as Mr.
    Whelan's, so I am going to have to move closer to the mic over
    here. Thank you for the opportunity to testify here today on
    how we can continue working to help heal and obtain justice for
    Pennsylvania children who have been victims of sexual
    predators. You are a great leader on the issue of preventing
    child abuse and helping survivors of child abuse have access to
    all of the services they need to heal.
        My Child Advocacy Center, Mission Kids, is an accredited
    member of the National Children's Alliance. We proudly support
    your Protecting Students from Sexual and Violent Predators Act,
    which seeks to help keep child predators out of our nation's
    schools. The bill also bans ``passing the trash,'' that
    terrible practice where a school can knowingly help a predator
    get a job someplace else so they become another district or
    state's problem.
        We also appreciate your cosponsorship of the Justice for
    Victims of Trafficking Act, which President Obama just signed
    into law. This law gives law enforcement additional tools to
    find traffickers and increases fines and penalties and reserves
    the money to fund services for trafficking victims, and we very
    much appreciate that the first $2 million collected will go to
    Child Advocacy Centers to help fight this, as well.
        And, we are very excited to work with you on the Fairness
    for Crime Victims Fund Act. I would like to speak for a moment
    on how the Crime Victims Fund could help Child Advocacy
    Centers, which in shorthand are known as CACs, across
    Pennsylvania and the country by explaining the purpose of CACs
    and the difference that CACs make.
        CACs are designed to help victims of child abuse through
    every step of the justice system and to obtain medical and
    emotional care. The need for CACs is best explained by one
    adult survivor of child sexual abuse. This person saw an ad
    that we created and the ad simply said, ``Imagine living the
    worst day of your life over and over and over.'' When this
    person saw the ad, he came to me and he said, ``I saw that and
    what clicked in my mind is that it was actually two worst days,
    the day of the abuse followed by the day of the
    investigation.''
        Child sexual abuse is a crime of secrecy. Child abusers
    groom their victims and take months or years to make the child
    that increasing touch is acceptable behavior. By the time the
    abuse takes place, the child may feel that they are to blame,
    and since 50 percent of the time the abuser is a family member,
    and over 90 percent of the time it is someone in a close
    relationship to the family, who is going to believe if they
    tell anyway?
        The mission of the CAC is to achieve healing and justice
    for victims of child abuse. At a CAC, police, prosecutors,
    social workers, medical and mental health professionals, and
    child advocates work as a team to help that child at every
    step, from investigation through prosecution to receipt of
    specialized medical help and mental health counseling. The goal
    is to limit additional trauma to the child and ensure that the
    child receives specialized needed services as quickly as
    possible.
        In communities without a CAC, if a child is brave enough to
    report abuse, they are often required to retell and, thus,
    relive the abuse through multiple repetitive interviews with
    social workers, prosecutors, police, victims' services,
    medical, mental health counselors, and they do it in places
    like an emergency room or a police station. Think about it.
    When you are a kid, you go to the police station because you
    are a criminal or you are bad.
        The child does not understand that somebody there is trying
    to help them, and often, because the adults are not properly
    trained, they use techniques which are very much more like
    interrogations than something designed to actually get the
    child's story from the child. And, too often, the child is not
    receiving the needed medical attention and mental health
    counseling, and the result is that the very professionals that
    are trying to help this child end up retraumatizing them over
    and over again.
        There is another danger to this typical approach of
    multiple interviews, and I am sure that Mr. Whelan and every
    other prosecutor who has prosecuted a child abuse case has
    found it, which is that when you have slightly differing
    testimonies and slightly different statements, which happens
    whenever different people hear it--we all hear things
    differently--then you have different statements that a defense
    attorney can pick apart later on in a courtroom.
        If the case reaches trial, the child often does not have
    the strength to tell their story again, this time in a
    courtroom not dissimilar to where we are sitting, with a judge
    in a big black robe, 12 strangers, and the abuser staring at
    them, and then undergoing cross-examination by the defense
    attorney. The prosecution will often fall apart and the child
    and family are left in a much worse situation than before the
    abuse was even reported.
        CACs make the child the focal point. All of the
    professionals come to the child, as opposed to making the child
    travel to the separate agencies. The child's experience starts
    when they are greeted by a professional, child-friendly staff
    at a center, which often resembles a pediatrician's office or
    after-school environment to make them feel comfortable. The
    child is then interviewed by a highly trained forensic
    interviewer. Forensic interviewers are responsible for
    obtaining a statement in a manner that is developmentally
    appropriate, using open-ended and non-leading questions that
    will not taint the interview further.
        Members of the multi-disciplinary team, made up of police,
    social workers, and prosecutors, are able to observe the
    interview live, often on closed circuit TV in the next room, so
    that they can see the nuances of a live interview. They can see
    the child's reaction. They can see facial expressions. And then
    they get a chance to sit and talk with each other, because one
    of the best things about a CAC model are watching these
    professionals share information in that observation room,
    because prosecutors and police and social workers all come to
    this process from different backgrounds, and all of a sudden,
    things and statements that are black and white to them as
    individuals become gray as they talk to each other. All of the
    result is a better investigation for all of them and a better
    outcome for the child.
        Victim advocacy services are begun as soon as the child
    arrives and a relationship of trust begins to build. While the
    child speaks to the forensic interviewer, the family members
    meet with a trained advocate. Many families are so overwhelmed
    by what they are going through that they do not even understand
    the need at the time for mental health services for themselves
    and their child, and the advocate will help them to understand
    that need and set them up with the very specialized services
    that they need.
        Children often react in different ways to child abuse. The
    reactions can be severe, such as depression or suicide, or they
    could be very vague--bed wetting, becoming introverted, or
    promiscuity, a decline in grades, or an over-achiever. Or, they
    may not even--the symptoms may not manifest themselves until
    sometime later in life when some life event triggers what
    happened to them and their experience.
        Bluntly put, CACs need more funds. Every child victim
    desperately needs help, but due to funding shortfalls, that is
    not always possible. The prevalence of child abuse is
    staggering. At Mission Kids alone, which serves only Montgomery
    County, Pennsylvania, we have done over 2,300 forensic
    interviews in five years. Between ten to 20 percent of all
    children will be victims of child sexual abuse before the age
    of 18. In Pennsylvania, 23 counties have a CAC, but 44 do not,
    often due to inability to fund a CAC. Nationwide, 1,000
    counties have no access to CACs. Some counties are attempting
    to begin a center like Mission Kids or use services of CACs in
    nearby counties, and some still have no CAC services at all.
        Many of the nation's CACs have one or two victim advocates
    for 900 children. It is not uncommon to hear in Pennsylvania,
    as you noted, that there may be a wait time of three to six
    weeks for mental health services or two to four weeks for non-
    emergency forensic interviews.
        Your Crime Victims Fund bill will make a huge difference to
    the abused children of Pennsylvania and across the country.
    Thank you for your help and caring about the most vulnerable
    victims in our society.
        [The prepared statement of Ms. Newman follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Toomey. Ms. Newman, thank you very much for your
    testimony.
        Next, we will hear from Ms. Moyer. Again, your written
    testimony will be included in the record and I welcome your
    oral testimony.

        STATEMENT OF DIANE MOYER, LEGAL DIRECTOR, PENNSYLVANIA
                         COALITION AGAINST RAPE

        Ms. Moyer. Thank you, Senator, and thank you for being a
    champion on not just VOCA, but so many other issues that other
    elected officials find it either too difficult to deal with or
    they are interested in other things. But, you have been a
    champion for those who cannot speak for themselves and I
    appreciate that and will never forget your devotion to this
    issue.
        I am Diane Moyer and I want to thank Chairman Enzi, Ranking
    Member Sanders, and you, Senator Toomey, for the opportunity to
    testify here today. The Senator talked about what sounds like a
    lot of work, and was, but after 18 years, if I did not have a
    lot of marvelous things to say about having helped victims,
    then I would not be doing my job.
        I want to thank you, Senator Toomey, for your unwavering
    commitment to victims of sexual assault, and I do want to read
    this into the record.
        The Pennsylvania Coalition Against Rape is proud to support
    the Protecting Students from Sexual and Violent Predators Act,
    the bipartisan bill introduced by you and Senator Joe Manchin
    of West Virginia. The bill works to stop sexual predators from
    infiltrating our children's classrooms by requiring schools
    that receive federal funds to conduct background checks on
    employees. When you say that sentence out loud, it just seems
    so absurd that we do not do that already, when we trust our
    children with these teachers every single day. The bill also
    forbids a school from allowing a child molester to resign
    quietly and then find a new teaching job elsewhere, and that
    has happened nationwide.
        We thank you for cosponsoring the Justice for Victims of
    Trafficking Act. It is another issue that people are reluctant
    to talk about that happens all the time. And, I would like to
    acknowledge Villanova's own Shea Rhodes, who is here, for her
    work on trafficking, which is groundbreaking and necessary. The
    President recently signed that into law. Human trafficking is a
    modern form of slavery. Vulnerable people, often women and
    children, but also men and boys, are forced into prostitution,
    often raped hundreds or thousands of times. We appreciate your
    leadership in ensuring that traffickers are punished and that
    additional funds are available for victims of trafficking.
        We are also happy to have the opportunity these past months
    to work with you in drafting the Fairness for Crime Victims
    Act, which will ensure a steady increased funding stream--
    sensible--from the Crime Victims Fund. While some of our
    elected officials voice support for victims of sexual assault,
    you have acted. While others join the occasional bill and then
    forget when they face any opposition, you have been unrelenting
    in fighting for victims of sexual assault, continuing to fight
    on both the Protecting Students Act and restoring fairness to
    the Crime Victims Fund, despite unbelievable opposition and
    obstacles.
        I would like to talk about some of the unmet needs of PCAR
    and its member programs, and I would also like to acknowledge
    the presence of some of the directors of our premier programs,
    Barbara Clark and her policy person, Julie Dugery, who does
    policy work in addition to being one of the best advocates in
    the state. Mary Onama and Barbara Clark, these women have
    dedicated their lives to victims of sexual assault, and I
    wanted to give them recognition. Thank you for indulging me in
    that.
        PCAR and our network of programs have consistently been
    good fiscal stewards of funding. However, as the identification
    of new issues and institutions addressed grows with our
    knowledge of victimization, the demands on services, education,
    and community awareness are stretched to the limit. We realize
    that outreach and messaging to different populations must occur
    in order to achieve our goal to eliminate sexual violence.
        As I have noted earlier, Senator Toomey has been a champion
    for victims of trafficking, who have an incredible continuum of
    needs that far exceeds most victims, including housing,
    addiction, alternatives to incarceration, trauma informed care,
    and accompaniment to medical and legal proceedings. We have
    always provided services to men, but appropriate outreach must
    ensure that these victims--that they will be treated with the
    dignity and care that they deserve.
        We have worked extensively with military victims, and our
    CEO, Delilah Rumburg, was a civilian co-chair of the Defense
    Task Force on Sexual Assault in the Military Services, and it
    is incredible what the military has been able to do in
    addressing the issue of sexual assault and as a leader for the
    rest of the nation. Ms. Rumburg was also on the Task Force on
    Child Protection in Pennsylvania as well as a member of the
    White House Advisory Council on Violence Against Women.
        Our leader has provided cutting-edge knowledge of sexual
    assault to these issues and has brought to the Commonwealth an
    urgency to treat the spectrum of victimization to programs in
    Pennsylvania and across the nation. Our programs have indicated
    just a few issues, the need for SANE Nurse programming,
    prevention education needed to reach boys and men--we know that
    it is different than the outreach that we have been doing for
    decades to women and girls and it is so important that every
    victim have access to services--collaboration with CACs and
    multi-disciplinary teams, counseling services under PREA, cyber
    crimes, prevention education at universities, storage,
    analysis, and victim notification about the testing of rape
    kits, transportation costs in our rural programs--people do not
    realize just how rural Pennsylvania is, that it is just not
    Pittsburgh and Philadelphia, we have quite a few counties in
    between--and the hiring and retention of qualified advocates.
        We know that you do not get rich doing this work, and you
    have to do it with a certain amount of heart and passion, but
    we believe that some of this Crime Victims Fund money should go
    to establish and maintain qualified staff and prevent turnover,
    because we need consistency in the treatment of these victims.
    And, we hope we can--I know you are not supposed to ask for
    money for salaries, but these people commit their lives to
    working with traumatized people every day, and I know they do
    at the CACs, as well. And, I know even though the District
    Attorneys may not admit it all the time, it is pretty intense
    for them, too.
        Finally, we have learned from providing services to victims
    that victims' compensation must be allowed to cover HIV
    medication to prevent this deadly disease. This medication is
    costly and usually not something that victims have the ability
    to pay for up front. Also, victims are often charged later for
    ambulance services that they did not call for, and imagine the
    trauma when the bills arrive for that service weeks after the
    assault. I urge the coverage of these costly but critical
    services for victims who through no fault of their own face
    financial retraumatization.
        We applaud the leadership of our Senator, Pennsylvania's
    Senator, in funding for crime victims and those brave advocates
    who provide services in our Commonwealth and across the
    country. I urge Congress to join Senator Toomey and his really
    marvelous staff in the swift and certain passage of this
    legislation.
        Thank you, sir.
        [The prepared statement of Ms. Moyer follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Toomey. Thanks very much, Ms. Moyer, for your
    testimony.
        Dr. Dierkers, your written testimony, as well, will be
    included in the record, and I invite you to share your oral
    testimony with us.

       STATEMENT OF PEG J. DIERKERS, PH.D., EXECUTIVE DIRECTOR,
            PENNSYLVANIA COALITION AGAINST DOMESTIC VIOLENCE

        Ms. Dierkers. Good morning. I also would like to thank the
    committee leadership and you for conducting this hearing and
    for inviting me to represent the interests of our 60
    Pennsylvania Domestic Violence Centers and the thousands of
    victims and children they serve every day.
        At this time, I would like to recognize the hard working
    and dedicated advocates who have joined us here today: Mary Kay
    Bernosky from Berks County Women in Crisis; Maria Macaluso,
    Women's Center of Montgomery County; Linda Thomas and Lauren
    Bucksner from A Woman's Place in Bucks County; Sally Casey,
    Schuylkill Women in Crisis; Beth Sturman, Laurel House,
    Montgomery County; Elise Scioscia, Director of Public Policy at
    Women Against Abuse in Philadelphia; and Kristen Wooley at
    Turning Point of Lehigh Valley.
        PCADV is an alliance of independent, private, nonprofit
    organizations that provide services and advocacy on behalf of
    victims of domestic violence and their minor children. The
    coalition was established in 1976 and is actually the oldest
    statewide domestic violence coalition in the nation. And since
    then, we have helped each state in the union establish their
    own state coalition, and now the six U.S. territories have
    State Domestic Violence Coalitions, as well.
        We have grown over our 40 years of service to a membership
    of 60 centers that provide services to every single one of the
    67 counties in Pennsylvania. Our member organizations are
    required to provide a range of holistic services, including
    emergency hotlines, shelters, counseling programs, safe home
    networks, legal and medical advocacy, and transitional housing,
    not only for the direct victim of abuse, but also their
    children. During the last fiscal year, as you said, our centers
    helped more than 85,000 Pennsylvanians, including over 7,000
    children.
        Unfortunately, 141 people lost their lives due to domestic
    violence homicide in 2014, 60 percent by the use of a gun, and
    we must do more to keep guns out of the hands of abusers.
        The Victims of Crime Act funds provide vital resources for
    both the victim and for the people trying to assist them, as
    you said, with no additional burden to taxpayers. In
    Pennsylvania, they are used for a wide range of critical
    services for victims of domestic violence, including crisis
    counseling, emergency legal advocacy, shelter and transitional
    housing, emergency financial assistance, and emergency hotline
    response.
        PCADV strongly urges the Pennsylvania Commission on Crime
    and Delinquency, who disburses these funds to our various
    counties to continue funding for these basic services that I
    just described while also considering emergency issues and
    unmet needs.
        I want to amplify the emerging issues that Diane Moyer has
    mentioned, the first being the issue of human trafficking, both
    nationally and at the state level. The General Assembly signed
    Act 105 into law during this last legislative session, and
    there is a great need in Pennsylvania for us to create a model
    of service and to train law enforcement as well as victim
    service providers to be able to help these minor victims and
    adult victims of human trafficking, and they have very unique
    needs that will require many more resources.
        Again, as Diane mentioned, we are more and more aware that
    serving male victims of crime, especially in cases of domestic
    violence and sexual assault, call for additional resources,
    both for staffing as well as to outreach men and help them
    overcome the social stigma and the barriers that they face.
        Regarding unmet needs, the Coalition and its 60 centers
    have been forced to live with less as a result of nearly a
    decade of flatlined funding by the state, as well as the loss
    of some federal funds, as well. As a result, we often cannot
    meet the growing requests for services from our communities.
    Last year alone, our 60 Domestic Violence Centers reported
    6,152 unmet requests for shelter due to the increased demand
    from increased public awareness about the issue of domestic
    violence and the inadequate resources to serve these victims.
        Every year, our national network participates in a one- day
    census, the results of which have just been published for 2014,
    and they are staggering. In one day in Pennsylvania, our
    network of 60 centers helped 2,498 victims of domestic
    violence, including 713 children. Of these services provided in
    that one day, 80 percent of the victims received emergency
    shelter, 80 percent received legal advocacy. However, in that
    same day in Pennsylvania, there were 252 unmet requests for
    services which could not be provided because programs, although
    they have the expertise, did not have the resources to meet the
    need.
        And, although our advocates do not always know what happens
    to victims who are turned away, and we do everything we can not
    to turn them away, our centers report that 60 percent of
    domestic violence victims for whom there are no services that
    day return to their abuser. Thirty-two percent become homeless,
    and eight percent are forced to live in their cars in order to
    escape the abuse. These numbers provide the realistic answer to
    the too common and unfortunate question of, ``Why doesn't she
    just leave?''
        Releasing additional VOCA funds can do so much to ensure
    that there will be adequately funded services available to help
    each time the victim has the courage to seek help.
        When there is an unmet need in the community, PCADV
    recommends that VOCA funds be used first to expand existing
    capacity before new organizations are developed. It is an
    efficient strategy that will reduce overhead in communities
    while investing in agencies with a proven track record of
    success, many of whom are here with us today.
        We also hope that VOCA funds will support services that are
    broad and holistic, that ensure confidentiality and a sole
    allegiance to the victim.
        We would also hope that VOCA funds can continue to be used
    to provide services regardless of whether a victim chooses to
    involve the criminal justice system. For domestic violence
    victims, this is especially important, as most of the justice
    they receive actually comes through the civil system and not
    always through the criminal system. These preferences empower
    and protect victims while honoring them as experts as to the
    safest way to support them in a journey to become survivor.
        We do recognize, also, the national need for a designated
    Tribal funding stream, and although Pennsylvania is not home to
    Tribal nations, many indigenous people live in our
    Commonwealth. PCADV supports the funding for Tribes in light of
    our work to overcome oppression for all people.
        As I bring my testimony to a close, I would like to talk
    about one more service, one of the most requested services of
    domestic violence victims and one that we hope can be expanded
    with the expanded resources of the Victims Crime Act. Whatever
    data point we look at, legal services is one of the most
    requested supports by survivors of domestic violence. The
    tactics of abuse create safety, economic, and child safety
    issues that can only be corrected with knowledgeable legal
    assistance and the help of the courts. And, again, as I said,
    often, it is the civil court system.
        Yet, we only have the resources in Pennsylvania to operate
    legal services in 15 counties, leaving victims and their
    children in 52 counties without help. Our 15 civil legal
    representation sites helped more than 4,000 victims last year
    at a low cost of $317 per case. Impact and value like this is
    rarely seen in the human services system.
        One of our Domestic Violence Centers that are here today,
    Women Against Abuse, was able to provide legal assistance to a
    survivor named Kendra in a custody case against her child's
    father. Before Kendra came to Women Against Abuse, she already
    had a protection-only order against her abuser, Mike, for a
    long history of abuse. Mike started arguing during a visit with
    the child and Mike put Kendra in a chokehold and wrestled her
    to the ground with one arm while holding their three-month-old
    child. Kendra was eventually able to get up and run into the
    bedroom to call 911. The police arrived on the scene of assault
    and arrested Mike.
        Kendra was shortly thereafter connected with Women Against
    Abuse, where an attorney in the civil legal project was able to
    assist in modifying her protection order to include no contact,
    and importantly, to file an expedited custody order to also
    help the child escape abuse, and Kendra was granted immediate
    primary custody of her baby. Women Against Abuse continues to
    help Kendra, because custody cases are very long. This is not a
    legal need that can be performed typically with pro bono
    services. And, Kendra has remained safe--Kendra and her child
    have remained safe from her abuser.
        So, we, too, urge Congress to pass your Fairness for
    Victims Act, S. 1495, and to disburse the Crime Victims Fund
    with the average of the past three years' deposit. With that
    ample balance that you described in the Crime Victims Fund, now
    is the time to create a stable and sustainable funding formula
    and to release that additional money for the purpose Congress
    intended and for which it has been collected.
        Again, I want to thank you for the championing of many
    issues, including this one, and your support of victims.
        [The prepared statement of Ms. Dierkers follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Toomey. Thank you very much, Dr. Dierkers.
        I would like for my first question to ask Ms. Newman and
    D.A. Whelan both to give their perspective. It seems to me, and
    having toured a number of the CACs, there are multiple
    objectives that you are trying to accomplish when a child is
    brought in for an interview. You want to determine what type of
    treatment this child might need, what kind of harm has been
    sustained. There is the interest in trying to protect the child
    from future abuse of whatever kind. And, of course, there is
    the interest in prosecuting the perpetrator. These are very,
    very different objectives and different goals, and as I
    understand it, you would try to achieve progress on all of
    these in one place through one or a brief number of interviews.
        So, my question to Mr. Whelan, who comes at this from a
    prosecutorial background, and Ms. Newman, who comes from a
    nursing background, very, very different backgrounds with a
    very different sort of focus, how does it work? How well does
    it work when you try to achieve these very different objectives
    in the same place at the same time?
        Mr. Whelan. Well, certainly, from the prosecutor's
    standpoint, we want to take dangerous criminals off the street.
    We want to take child abusers off of the street and prevent
    them from re-offending to prevent the crime from occurring
    again. But, we also have to realize the compassion associated
    with these type of crimes, and the compassion is dealing with
    the victims of these type of crimes, whether they are children
    or adults.
        That is why we have been advocates of these centers. These
    Child Advocacy Centers are important, because they are
    important because they protect the child. As Ms. Newman alluded
    to during her comments, she had indicated--and this is what we
    are experiencing--if the child is a victim, that child then
    reports it typically to the parent or trusted adult who call
    the police. The police come in and then the child tells their
    story, exactly what occurred, to the police. Then they may go
    to the hospital, tell their story again. And then we have
    detectives interviewing the child again, and it goes on and on
    with the child being interviewed multiple times.
        The problem is, as was pointed out by Ms. Newman, every
    time the child deviates, even slightly deviates, from what they
    explained to the previous provider, then the defense attorney
    in the criminal case will try to make the child sound like they
    are lying through cross-examination.
        Senator Toomey. And, just to be clear, the deviation might
    be just remembering things one time that were forgotten a
    different times and that sort of deviation.
        Mr. Whelan. Correct, or remembering more than they did
    before.
        Senator Toomey. Right.
        Mr. Whelan. Now, all of the sudden, they remembered more,
    and all of the sudden they are being faulted for remembering
    more, or maybe the first interviewer did not conduct a thorough
    interview and now the defense attorney is going to twist--and
    they are doing their job under the Constitution, but they are
    going to twist the words of the child and they are going to try
    to convince the jury who sits up in these courtrooms that the
    child is not being sincere, and in those particular cases, our
    burden of proof is beyond a reasonable doubt, and in those type
    of cases, many times the jurors have doubt and those
    individuals are acquitted. Then they go back to re-offending,
    typically, and we are back to square one.
        Where Child Advocacy Centers bring a multi-disciplined
    approach and bring all together the disciplines of that
    children, they bring in the psychology, the CYS worker, the
    police officer, the detective, the Assistant District Attorney.
    The child is interviewed. The interview is taped and then the
    taped interview is turned over to the defense attorney. And
    what we have found, statistically speaking, in those
    jurisdictions that have Child Advocacy Centers, our
    prosecutions are much more successful.
        Senator Toomey. So, I think that is a really, really
    important point. So, you are arguing that the existence of the
    Child Advocacy Center, the process that they follow, that
    actually leads to a higher likelihood of getting a successful
    prosecution of the perpetrator?
        Mr. Whelan. Which is important, but equally important is
    that it protects the child--
        Senator Toomey. Right.
        Mr. Whelan. --from being further victimized in the criminal
    justice system.
        Senator Toomey. Right. Well, and putting perpetrators
    behind bars makes it impossible for them to victimize the next
    child, so--
        Mr. Whelan. Correct, Senator.
        Senator Toomey. --that is really important.
        Ms. Newman, now, your background is as a pediatric nurse.
        Ms. Newman. Yes.
        Senator Toomey. In your experience, how has this process
    worked for individual children that you have seen in your
    facility?
        Ms. Newman. Let me back up a minute and say that because
    the CAC is neutral in fact finding, when a case comes in--when
    a child comes in for an interview--when the interviewer does
    the forensic interview, conducts it, there is no pre-set
    determination that something had to have happened. The
    questions are specifically asked in age- appropriate, open-
    ended fashion so that the child tells the story, if indeed
    there is a story to tell, in their own words. And, nobody has a
    better day than when the team sits in the room and watches that
    interview and the child says in a very credible fashion,
    without anybody leading them on, that there was a mistake, that
    somebody did not see what they thought that they saw, and there
    is no further investigation.
        But, then you have all those other cases that come in and
    you have a child that has been victimized, no matter how
    slight. It could just be something--and I do not want to get
    too graphic, but something just over the clothes to something
    much more brutal and horrible. And, in all of those cases, that
    is when the CAC works really well.
        As D.A. Whelan said, you have one statement. It is
    recorded. There is no question that it is not leading. What we
    often see, and I think Mr. Whelan may be able to confirm this,
    is that what happens is that there are plea bargains that
    before may never have occurred because you have a defense
    attorney and a defendant, you cannot prove anything, it is just
    a child that gave that statement, and the experience in
    Montgomery County has been that the district attorney will hand
    that defense attorney the DVD and say, ``Why do you not go
    watch that,'' and lo and behold, not long afterwards, they come
    forward and have a plea bargain struck, and that is a great
    day, too, because then that perpetrator is off the street and
    that child never has to enter a courtroom, never has to go
    through that experience again.
        Also, because of the CAC set-up, what you have are victim
    and family advocates and referrals to specialized medical and
    mental health treatment, and that is really important, because
    the dynamics of child abuse are very different from adult rape
    and domestic violence. As I said in my statement, child abusers
    put themselves in positions of being close to children, and
    most of the time, it is not a sudden act of violence. It takes
    place over time. The abusers take the time to groom their
    victims. They start with touch. I remember from the Jerry
    Sandusky testimony, and I know people, especially in
    Pennsylvania, are tired of going back to that, but one of the
    witnesses said, ``You know, you knew when you got into a car
    with Coach Sandusky that his hand was going to be on your
    thigh.'' That is how abusers work, slowly.
        And, in the 50 percent of the time that it involves a
    family member, the dynamics of the family become so skewed. The
    family often would rather not say what is going on, because if
    it is a mother's father or brother or husband or significant
    other, as it may be, who wants to see that that person who is
    so close to you is really a monster who is doing this to their
    child. And, there is often the mistaken thought that we can
    handle this at home. We can do this as a family and just keep
    the perpetrator away from the child.
        But, number one, that often does not happen, because they
    cannot do that. And, number, two, it just leaves this person
    out there, as in the recent news reports about the Duggar
    family, where the older son--and I am just reading from the
    papers here--was brought back into the home and abused
    additional children, if those allegations are true. But, that
    would certainly fit the pattern of what we see.
        Specialized mental health treatment is important for this.
    It is evidence-based. It is not just going to any old
    counselor, so that is important. Specialized medical treatment
    with pediatric sexual assault nurse examiners are very
    important for these children.
        Sometimes for older children--and I will wrap up here, I
    know I am going on--it is important for them to have this
    medical examination just so they can be told, you are okay.
    Nobody can see what happened to you unless you choose to share
    it with somebody. That is often as important as anything else
    that we can possibly do at a Child Advocacy Center. Thank you.
        Senator Toomey. Thank you very much.
        Now, let me go right to one of the arguments that I have
    heard from people who are not supporting my legislation, which
    is, as you know, designed to increase the amount of funds that
    are distributed to the various crime victims' groups, and maybe
    Ms. Moyer could lead off, but I would like to ask each of you
    to address this, and this argument is, well, it would be a big
    bump-up in funds and you really probably cannot spend it very
    well. So, maybe you could address that and share with us for
    the record exactly how you would put these resources to work if
    you had the knowledge that you had a sustained funding level at
    this higher level that would be commensurate to the amount of
    money that is actually going into the fund each year.
        Ms. Moyer. Well, first of all, Senator, thank you for the
    question, because I believe we debunk that myth. I think there
    is a special Internet place where they have things like that,
    that, oh, those people could not possibly spend that money. Of
    course, we can. We have executive directors taking pagers home
    and responding to two o'clock in the morning calls instead of
    doing community awareness and managing an organization.
        And, let me just--I will leave you with one situation that
    particularly moved me, although, as you can tell, this is my
    passion. Women Organized Against Rape in Philadelphia, they
    were under construction, and because of a lack of funds, they
    were unable to do individual child counseling and they had to
    do group counseling. And, it was in the reception area. The
    place was under construction. And, all these kids were sitting
    and standing and laughing and playing, as kids are wont to do,
    and the construction workers came in and said, ``Gee, I did not
    realize you were running a day care center.'' And, the ED
    explained to them that this, in fact, was a group of children
    who had been sexually abused. One of the children was a four-
    year-old who would live with a colostomy bag for the rest of
    her life. And, I apologize for being graphic, but sometimes I
    think we need to be, because these children are living their
    lives with this constant reminder, physical or emotional, and
    there is no way to undo that.
        I appreciate our collegiality with CACs and our dedication
    of our district attorneys and our sister coalition in child
    abuse cases, but if you have a group of children acting as if
    it were an ordinary day at a day care center, and if you could
    see the rooms where play therapy happens, it looks like a day
    care center, but it is a place where children who have been
    raped by monsters go to heal, I think there would be no doubt
    in your mind that we could find good use for this funding.
        We need more prevention educators. We need outreach to men
    and boys, and in an intentional way. Prevention is no longer a
    dirty word. I think we realize that it does work. And, as a law
    enforcement officer once said to me, ``Diane, these are one-man
    crime waves,'' and we need all these resources to get these
    monsters off the street, and with your help, Senator, I think
    we can do that very easily.
        Senator Toomey. Thank you.
        Dr. Dierkers, would you care to address the question.
        Ms. Dierkers. Yes. As I mentioned in my testimony, housing
    is a particular concern for domestic violence victims and we
    need various forms of housing. Often, economic abuse is a
    common tactic used, and it may take a survivor some time to
    recover economically and be able to support themselves and
    their children. Legal services, because when children are in a
    domestic violence home, often, the children are being abused,
    and we know from research now, longitudinal research, the
    children who even witness abuse will sustain life-long impacts
    if there is not support, help, and healing for them.
        We were really gearing up in terms of our children's
    services, because, as I mentioned, we do see thousands and
    thousands of children through our Domestic Violence Centers
    every year. We were just gearing up specialized services when
    the recession hit. So, that is an area that we would definitely
    dedicate money to, as well, as well as legal services.
        Senator Toomey. And, Ms. Newman, my understanding is the
    large majority of Pennsylvania counties do not have their own
    Child Advocacy Center, so victims have a long way to go to get
    to the nearest one in many cases. I assume additional funding
    would help lead to the development of additional facilities, is
    that true?
        Ms. Newman. Absolutely. In Pennsylvania, there are only 23
    counties that actually have Child Advocacy Centers. the
    Pennsylvania Task Force on Child Protection in 2012 said that
    the number one priority for the safety of Pennsylvania's
    children from sexual predators should be to have a Child
    Advocacy Center, and they said within two hours of every child.
    District Attorney David Heckler, who chaired that task force,
    said that had there been a CAC in Centre County, again, at the
    time of Jerry Sandusky, that he would have been stopped after
    victim number one. So, how many children would that have saved
    who came forward? We do not even know how many never came
    forward.
        It costs money for these centers. Two hours is a long way.
    That is a long time, especially if you have parents that are
    taking off from work that have to go, that may have to use
    public transportation to get there. They may have other
    children that they need to bring with them to the center. At
    the State Chapter of CACs, we would like to see that brought
    down a lot closer to an hour, and even that is a long way,
    because, again, you have children. They get tired. They are
    already traumatized. The family is already traumatized. We do
    not necessarily have to have a CAC in every county, as was
    alluded to. There are a lot of rural areas in Pennsylvania.
    But, certainly, regional centers need to be developed and built
    to help all of the children have access. Thank you.
        Senator Toomey. And just so that everybody understands, you
    folks are not dealing with abstractions. You are dealing with
    real human beings, people who have been victimized. And Dr.
    Dierkers gave a great example of a woman named Kendra and her
    circumstances.
        Ms. Moyer or Ms. Newman, is there maybe a brief story of a
    particular victim that you would like to share with us so that
    we can sort of see exactly the kind of person and the
    circumstances in which the work that you do is so helpful?
        Ms. Newman. Do you mind if I go first?
        Ms. Moyer. No, not at all.
        Ms. Newman. Thank you. I am just--I am particularly
    passionate about one story. He is actually the inspiration and
    the reason that Montgomery County has a CAC. His name is Sasha.
    He grew up on the Main Line, very close to where we are sitting
    right now. Child abuse knows no economic boundary, zip code, or
    religion.
        When he was a young child, he was in an intact family,
    mother, father, younger sister. Uncles came down to visit,
    father's brothers, one of whom was a very well known cantor up
    on the Upper East Side of New York in a large synagogue there.
    For people that may not be familiar, a cantor is a cantor rabbi
    in the Jewish faith.
        Sasha went from being a very normal child to, as his mother
    describes, one that she had to try to keep alive, because he
    suddenly walked around with underwear over his head and a knife
    to his throat, tried to jump out of moving cars while she was
    driving. She brought him to numerous therapists who had no idea
    what was going on. And, as Sasha tells the story now as an
    adult, he said he was finally able to disclose to one of the
    many psychiatrists that they were bringing him to when he saw
    his uncle go in and attempt to abuse his younger sister. And
    that was what finally allowed him to disclose the terrible rape
    that had been happening to him over and over and over again.
        Sasha's mother, when she told her husband about it, his
    response was, ``I probably should have realized what was going
    on because they did the same thing to me when I was a child.''
    Again, the dynamics of intra-familial sexual abuse. It can be
    generational, as well.
        They were brave enough to report it. The mother went to
    Risa Vetri Ferman, our current District Attorney in Montgomery
    County. She was an Assistant District Attorney at that time.
    Ten years, from when Sasha was seven until he was 17 years old,
    before that case finally ended with a low plea deal for the
    cantor.
        I remember before I was ever involved with this movement
    watching on the 11 p.m. news, busing in supporters of the
    cantor from the Upper East Side of New York to say to the
    District Attorney of Montgomery County, ``How dare you
    prosecute our clergy, our member, our leader.''
        Sasha went to college. He moved out to Montana to get to
    this area. And, I have had a lot of memorable days at Mission
    Kids. I think that one of the ones that sticks out most in my
    mind is the day that Risa sent him to Mission kids to see,
    because of what he had been through, what developed. And he
    came into the center and I saw this rough, just graduated
    college student melt back into a little boy, and he looked at
    the stuffed animals around the room and he said, ``Oh, my God,
    I would have loved this place. You feel like you are enveloped
    by the stuffed animals in here.''
        And we had a bowl of just snacks on the table, pre- wrapped
    snacks for the kids when they came in. And he said, ``Oh, those
    are great. I am so glad you do not have vending machines.''
    And, I was really surprised, and I said, vending machine? Why?
    It never occurred to me one way or the other, but why? And, he
    said, ``Because I cannot tell you how many dozens of times I
    was at police stations and the District Attorney's office and I
    was there for hours and I was hungry and the only thing to eat
    was in the vending machine.''
        That is my story. Thank you.
        Senator Toomey. Thank you.
        Ms. Moyer.
        Ms. Moyer. Yes. I would like to talk about--we have not
    talked about the campus sexual assault, and I am happy to say
    that we are addressing that more fully, as well. But, we had a
    victim and the campus judicial hearing did not go well. But,
    she knew that she had a place to go. What I always tell our
    advocates is that we do not make promises we cannot keep. We
    have confidential services, but we have a duty to report, but
    we always believe our victims.
        The only respite this individual had from what was a
    botched--clearly, a botched hearing at the campus level, and it
    was very problematic. The District Attorney and I, on the side
    of right, of course, were trying to help this victim, but there
    was a lot of push-back from the campus. But, what the victim
    did have was belief in her story and the offer of safety and
    services, trauma-informed, and the courage to go on with her
    life and move to another campus and successfully graduated
    because she did not get the justice that she deserved, and that
    does happen to victims quite a bit. But, what we do give them
    is belief, help, hope, and healing, and that is what every
    victim deserves.
        Senator Toomey. Thank you very much.
        We are getting to the end of our allotted time here, and I
    just wanted to make sure if any of our witnesses had a final
    point they wanted to make that they felt we did not have a
    chance to develop earlier, this would be a good time. Does
    anybody have any last points?
        Mr. Whelan. No, just to thank you for hosting this event
    today, Senator.
        Senator Toomey. Well, thank you.
        So, let me--really, I want to thank each of our witnesses
    very much. This is very, very helpful and powerful testimony
    and it will help us to make the case for why we need to do the
    right thing, stop the dishonest budgetary gimmicks and start
    allocating the resources that ought to be going to crime
    victims' advocacy groups.
        I want to thank people who are in the audience. I know many
    of the people here are working in the front lines, helping to
    support and help the victims of all kinds of crime. So, I
    appreciate the work that you do day in and day out. I know how
    hard that work is and I am grateful to you for being here.
        I do, once again, want to thank Villanova Law School for
    making this wonderful facility available to us and being kind
    enough to invite us in to have this hearing.
        And, I just want to assure everybody, this is a high
    priority of mine, and as a member of the Budget Committee, I
    will be able to ensure that we take this up in the committee. I
    am confident that we can pass the legislation in committee, and
    that will give us a chance to bring it to the Senate floor. My
    hope is that this year, we will find a vehicle that will allow
    us to enact this legislation and provide the certainty of
    funding going forward at this much higher level that is, after
    all, only commensurate to the amount of money that criminals
    are putting into this fund every year.
        So, I really thank you for all your help. I am going to
    need to continue to ask you to help and keep the pressure on my
    colleagues so that we can get this done. But, I am confident we
    will get this across the goal line.
        So, thank you very much, and with that, the hearing is
    adjourned.
        [Whereupon, at 11:12 a.m., the committee was adjourned.]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

     FIELD HEARING ON TAX-RELATED IDENTITY THEFT AND FRAUDULENT TAX RETURNS

                           Wednesday, August 26, 2015

                                            U.S. Senate
                         Committee on the Budget Manchester, NH
        The committee met, pursuant to notice, at 2:00 p.m., in
    Room 201, UNH Manchester Campus, 88 Commercial Street, Hon.
    Kelly Ayotte presiding.
        Present: Senator Ayotte.

                  OPENING STATEMENT OF SENATOR AYOTTE

        Senator Ayotte. I just wanted to welcome all of you here
    today. My name is Senator Kelly Ayotte, and I'm very glad to
    have the opportunity today to hold an important field hearing.
        I serve on the Budget Committee in the Senate, and one of
    the important topics that we have dealt with not only on the
    Budget Committee but, another committee I serve on, the
    Homeland Security and Government Oversight Committee, is tax-
    related identity theft and fraudulent tax returns.
        So I'm going to call this hearing to order.
        For my constituents that are here today, this will be part
    of the official Senate record. We're having this as a field
    hearing, but it will be part of the Budget Committee's official
    record. So that's why you see me here with the gavel in this
    setting, and also I've got some staff members here from
    Washington, the Budget Committee, as well as my own staff.
        So I'm going to call this hearing of the Budget Committee
    to order.
        We have on the first panel two witnesses with us, Ms. Lori
    Weeks from Strafford, New Hampshire; and also Mr. John Walker,
    from New Hampshire as well.
        I will begin this hearing by giving an opening statement,
    and then I'm going to turn to our witnesses to provide us with
    information and to give their opening statements.
        I want to thank all of you for joining us today for this
    important field hearing of the Senate Budget Committee. I would
    like to thank all the witnesses on both panels that you'll hear
    today for their time and for their willingness to participate
    in this important discussion.
        We're here today to discuss a growing problem not only in
    New Hampshire but across the country, and that's tax-related
    identity theft. Tax-related identity theft is a very serious
    problem that's growing, unfortunately, at epidemic proportions.
    According to the Treasury Inspector General for Tax
    Administration, about 2.4 million taxpayers' names or Social
    Security numbers were used to file fraudulent tax returns in
    2013, when this data was looked at. That's a 10-fold increase
    from 2010, and we've seen further activity in 2014 and beyond.
        With major data breaches occurring more frequently, most
    recently with the Office of Personnel Management, when millions
    of people who have gone through a Federal background check had
    their personal information breached. I'm concerned that we will
    see additional cases of tax fraud that impact even more
    taxpayers in the future.
        Filing a tax return should be easy, but for an increasing
    number of taxpayers, they find themselves victims of identity
    theft. This is too often the beginning of a frustrating and
    burdensome process that can take even months or years to
    resolve. These innocent taxpayers frequently find themselves in
    a confusing and frustrating maze of bureaucratic red tape. I've
    heard stories from my constituents, some of whom are here today
    and some of whom couldn't be here today, who have been caught
    up in this maze of frustration.
        Not only do taxpayers have to spend too often countless
    hours collecting and submitting the necessary documents to
    prove their identities, they're often given conflicting
    instructions and inconsistent messages from the IRS.
        Or worse, they've had a lot of difficulties reaching the
    IRS. Instead of focusing on regaining and safeguarding their
    personal identities, tax fraud victims spend hours simply
    trying to prove who they are actually to the IRS, and that's
    wrong. I'm very glad to have the IRS Commissioner here today.
    We must do more to address this issue and better assist
    taxpayers who are facing this problem.
        One of those taxpayers we have here today is Lori Weeks
    from Strafford, New Hampshire, and I want to thank Lori for her
    willingness to share her story today and for her courage. Lori
    has endured something that no mother should ever have to
    experience, and that's the loss of her daughter, Madison, in a
    tragic car accident. That heartbreaking loss was compounded
    when Lori's her husband learned that Maddi's identity had been
    stolen and used to file three fraudulent tax returns.
        But when Lori asked the IRS for copies of the fraudulent
    returns so that she could find out how much of her family's
    personal information was compromised, the IRS said it could not
    provide her with information or a copy of the fraudulent tax
    return, citing privacy concerns.
        Tax fraud victims shouldn't be left in the dark regarding
    the full extent of what personal information was stolen, and
    the least the IRS can do is to provide them with copies of the
    fraudulent returns so that they can understand how their
    information was manipulated and used fraudulently.
        On behalf of Lori and other New Hampshire families I wrote
    to Commissioner Koskinen--who is here with us today, and he
    will be testifying on the second panel--this spring and asked
    the IRS to change its policy and to provide victims of tax
    fraud with copies of fraudulent returns filed on behalf of the
    tax fraud victim.
        In response, the Commissioner has agreed to establish a
    process in which identity theft victims can obtain copies of
    fraudulent returns, and I look forward to hearing an update on
    where that policy change is today. I thank the Commissioner for
    agreeing to change that policy, and I certainly urge the agency
    to get this process in place as soon as possible.
        I've also heard from several tax fraud victims in New
    Hampshire who continue to struggle to get their refunds from
    the IRS, even after having proven their identities to the
    agency. One constituent from Bath told me that the IRS told him
    that he should receive a refund within six weeks of proving his
    identity. When eight weeks passed without any progress, he
    called the IRS again to follow up. After waiting on hold for 45
    minutes, this individual was told that processing his case
    would take up to six months.
        The IRS' mission is to provide America's taxpayers top-
    quality service by helping them understand and meet their tax
    responsibilities, and by applying the tax law with integrity
    and fairness to all. However, these examples demonstrate the
    IRS is falling short of fulfilling this mission.
        In her latest report to Congress, Nina Olson, the Taxpayer
    Advocate, notes that the IRS continues to view itself as an
    enforcement agency first and a service agency second. I know
    the IRS is taking some important steps to reduce fraud that
    have been recently announced. I appreciate those efforts, and
    we want to hear about those efforts today, including enhanced
    collaboration with representatives of tax preparation and
    software firms and other tax industry partners, and a new
    policy to earlier match W-2 information received from employees
    and employers. However, it is clear that much more must be done
    to prevent fraud from occurring in the first place to make sure
    that people aren't victims of identity theft and to better help
    victims when fraud does occur.
        Congress can also play a very important role to the extent
    that legislative fixes are needed to reduce fraud. Earlier this
    year I worked with Senator Ron Johnson from Wisconsin, who is
    the chairman of the Homeland Security Committee, and Mark
    Warner of Virginia to help introduce the bipartisan Social
    Security Identity Defense Act of 2015. This proposed
    legislation would require the IRS to notify an individual if it
    has reason to believe that someone's Social Security number has
    been fraudulently used. So notifying victims is incredibly
    important. It also requires the IRS notify law enforcement, and
    requires that the Social Security Administration to notify
    employers who submit fraudulently used Social Security numbers.
    This bill adds civil penalties and extends jail time for those
    who fraudulently use an individual's Social Security number.
        The purpose of our hearing today is to take a critical look
    at how the IRS handles tax-related identity theft cases, with
    the goal of identifying necessary steps the IRS must take to
    improve its response to this growing problem.
        I want to welcome our first panel, Lori Weeks of Strafford,
    and John Walker, a tax preparer based in Concord, who will
    share his experience working on tax-related identity theft
    cases for his clients.
        During the second panel we will, hear from the IRS
    Commissioner, John Koskinen. We will also hear from the
    Inspector General, J. Russell George, from the Treasury
    Department. We appreciate the Inspector General being here
    today. We will also hear from Mr. Christopher Lee of the
    National Taxpayer Advocate Service, to examine the IRS'
    administrative practices and look at ways on how we can improve
    service to taxpayers and make sure that we're more responsive
    and can take steps that need to be taken to prevent identity
    theft in the first place.
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Again, I want to thank all of you for being here today, and
    now I would like to call on our first witness.
        Again, I want to thank Lori Weeks for being here to offer
    her opening statement.
        Ms. Weeks.

    STATEMENT OF LORI WEEKS, STRAFFORD, TAX-RELATED IDENTITY THEFT
                                 VICTIM

        Ms. Weeks. Good afternoon. My name is Lori Weeks, or, as I
    prefer to be referred to, Maddi's mama. This is my daughter,
    Madison Charlotte Weeks. Madison was born on June 23, 2006. She
    was our first child. Through the years, Madison grew into a
    precocious little thing with a brilliant mind and an empathy
    for people that is rarely seen in a child her age. That empathy
    pushed her to continuously thank each and every veteran we
    passed on the street, to raise money for the fight against
    childhood cancer and to volunteer for the March of Dimes, the
    organization that helped save her baby sister when she was born
    prematurely.
        Like I said before, Madison had a brilliant mind and in 2nd
    grade tested at an end of 5th grade reading, writing, math and
    science level. We were so proud but not surprised. Madison was
    a talented dancer and was well loved by every person she had
    ever met.
        Madison was a Girl Scout, an artist, an animal lover, a big
    sister, a best friend, my best friend. She had dreamed of
    opening a veterinarian's office when she grew up that offered
    free care to those who could not afford it.
        On February 19, 2014, on our way to dance class, in the
    middle of her 6th year of dancing, we hit black ice. I hit
    black ice. We went off the road. We were okay, but in the blink
    of an eye another motorist, distracted, did not see our vehicle
    and did not slow down. She hit our car and took the life of our
    precious daughter. Our lives are irreparably destroyed.
        In March of 2015, my husband and I prepared to file our
    taxes. As we walked in I was having trouble breathing. Tears
    were already welling in my eyes. As we sat and reviewed our tax
    documents, I could not stop crying. This would be the last
    time, legally, on paper, that I could say I am the mother of
    two daughters. I finished up this painful process and later
    that day my husband went to sign our documents. This is when we
    found out. What we had left, that fleeting moment in time, had
    been stolen. Madison's identity had been stolen and someone
    else had claimed her on their taxes.
        When your child goes on before you, all you have left is
    their memory, their identity, and you will tirelessly work to
    protect it. All I could hear in my head was that I had failed
    to protect Maddi's life, and now I had failed to protect her
    identity. Our tax preparer could offer little assistance. She
    was kind but completely unaware of what our next step should
    be.
        We filed a police report with our local police department,
    only for them to treat us like we were crazy for doing so and
    telling us that it was unnecessary. I spent hours and hours on
    the phone trying to figure out what to do. Most of that was
    spent on hold. I spoke to multiple agencies and multiple
    representatives within each of those agencies, most of whom,
    their calls led me back to another agent who just couldn't help
    me. Many encouraged me to file without Maddi on our return so
    we could get our money. It was never about the money. I had to
    get Maddi's name back. It's all we have now. So we just kept
    searching for answers, searching for someone to help us.
        That is when a friend reached out to me and told me to
    contact Senator Ayotte's office. From there the ball really got
    rolling. We were put in contact with the Tax Advocate's office
    and they were able to see that Maddi's name had been filed at
    least three times, all of which had been rejected. Despite
    these attempts to fraudulently claim our child, we were never
    contacted by any IRS representative to make us aware that this
    had happened.
        With the help of Senator Ayotte's office and the Tax
    Advocate we were able to go through the proper avenues to
    protect her name further, stop any kind of continuing fraud
    using her Social Security number or otherwise, and we were able
    to file our taxes, as a family of four, for the very last time.
        We received our return, and then that was it, nothing to
    tell us what these disturbed individuals who would raid a
    deceased child's identity knew about our daughter. Was it just
    her Social' Did they know anything about her medical history'
    Do they have personal information about her death' Do we know
    them' It was quite literally, 'Here's your check and be gone
    with you.'
        After a newspaper article about our family and a few
    television interviews, we were told the IRS is going to be
    giving victims access to the fraudulent returns and the
    information contained within them. That was months ago and we
    still are no closer to knowing what we must know than we were
    the day we found out Maddi's identity had been stolen.
        More than 50 percent of grieving parents, parents whose
    children passed away before their 13th birthday, will have
    their child's identity stolen. And many will never even get as
    far as we have. We are not the rule; we are the exception. And
    it seems like the bad guys win in every case because although
    we got our daughter's name back, we do not know what they know
    about our daughter, and they will likely never face punishment
    for the crimes committed against our family.
        It's time we step up and we empower our citizens to protect
    themselves and their children against these predators and to
    say enough is enough. Thank you.
        [Applause.]
        [The prepared statement of Ms. Weeks follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Ayotte. Thank you. Thank you so much. I know all of
    our thoughts and prayers are with you for your courage. Thank
    you for being willing to be at this hearing today to help other
    parents so that they don't have to go through this.
        I would like to also welcome Mr. John Walker. Mr. Walker is
    here to talk about his experience as a professional and his
    work with many clients who, unfortunately, have dealt with
    identity theft issues and theft of their personal information.
        Mr. Walker, thank you for being here.

       STATEMENT OF JOHN C. WALKER, ENROLLED AGENT, J. WALKER &
                              COMPANY LLC

        Mr. Walker. Thank you, Senator, and thank you for holding
    this hearing. My name is John Walker. I am an enrolled agent in
    private practice. I was asked to testify today from the
    perspective of an enrolled agent and the impact tax-related
    identity theft is having on the professional community.
        Just to clarify, for those who are not familiar, when we
    talk about the professional community, I'm referring to the
    four groups of tax professionals that we generally talk about:
    enrolled agents, CPAs, attorneys, and then all other preparers.
    Generally, it is enrolled agents like myself, CPAs and
    attorneys who are authorized by Circular 230, which is the
    Treasury regulations, to represent taxpayers before the
    Internal Revenue Service. Other preparers, with a few very
    limited special exceptions, do not represent taxpayers.
        I represent taxpayers such as Lori and others who have
    problems dealing with the IRS, have these experiences, have
    jobs, family, responsibilities that they must move forward
    with, and they turn to someone like me, or an attorney, or a
    CPA, to handle the dealing with the IRS, do the investigation,
    because we know the system.
        As a professional, I am a member of the National
    Association of Enrolled Agents, the National Association of Tax
    Professionals, the National Society of Accountants, and I'm
    currently on the Board of the New Hampshire chapter of the
    National Society of Accountants.
        On a monthly basis I participate with members of the IRS
    and 15 to 30 other tax professionals from around New York and
    New England in what are called IMRS telephone conferences. IMRS
    is the IRS' own Issue Management Resolution System.
        In addition, twice a year I participate in taxpayer liaison
    meetings, one of which we host here in New Hampshire, and that
    is two dozen tax professionals and IRS managers meeting for
    half a day to discuss in depth the issues in our tax system.
        So with that as a background, I can tell you the issue that
    I am hearing over and over and over again from other
    professionals is that as a result of tax-related identity theft
    and the escalation of fraudulent returns, tax professionals are
    increasingly finding themselves shut out of being able to get
    the information they need to help their clients, to help the
    victims of these identity thefts.
        It's regrettable, but in their haste to respond to the
    explosion of fraudulent returns, the IRS has severely
    restricted or blocked entirely access to taxpayer information
    by those three professional groups--enrolled agents, CPAs and
    attorneys--who are responsible for representing those victims.
    As a representative, just like an attorney, we speak for the
    victim. We step into their shoes, we put in the time, the
    hours, to try to find solutions.
        This is happening even when a taxpayer has specifically
    authorized us on a Federal power of attorney, which is an IRS
    document, to represent them in the identity theft matter. I
    recently had one that was filed in August, and it is
    continually rejected for being posted because their 2014 tax
    year has already been flagged as having had an identity theft.
        The general consensus of so many professionals right now is
    that we feel like the IRS, instead of working with the
    professional community to speed resolution of these cases, is
    making it increasingly difficult and sometimes impossible to
    help these clients.
        Furthermore, and this is terribly important from a
    professional point of view, the victims of identity theft are
    still expected to comply with all other aspects of the tax law,
    to timely file their returns, pay their taxes, make estimated
    tax payments, continue installment payments, and fulfill
    obligations under an Offer and Compromise, if they have one.
        Ordinary, routine tax problems will arise in those other
    compliance issues--the estimated payments posted to the wrong
    account or the wrong year, just to give you one example. To
    assist the taxpayer with any of those problems and do it
    quickly and efficiently and get it corrected requires that we
    continue to have access to the same information we had before
    the identity theft occurred.
        On a case I'm currently working now, the taxpayers came out
    of bankruptcy last year. As part of their bankruptcy plan,
    they're paying on past tax debt. I cannot get any records to
    find out if those payments are being correctly applied to their
    past tax debt, and that is something that we used to have
    routinely as a matter of being able to represent people.
        Normally, a representative would have online access to a
    client's tax information using a tool that's very different
    from the tool that was out there and became such a problem
    earlier this year. The professional tool works much more like
    what most of us use to manage our personal bank accounts,
    perhaps even our medical accounts, make our utility payments,
    credit card accounts, insurance, student records, and the like.
    In other words, access to it is known only to us.
        What makes this all the more frustrating for tax
    professionals is that very often a representative or someone
    posing as a representative, or someone claiming to be the
    taxpayer, can call the customer service number. Granted, they
    have to sit on hold anywhere from an hour to two hours, so it
    becomes an endurance contest. They get a customer service rep.
    They can answer a few simple questions, Social Security number,
    address and so on, and the representative will mail, fax, or
    even read the information to them over the phone.
        So from a professional standpoint, the information that we
    used to be able to get in 5 or 10 minutes online and get a
    problem solved, now we may be able to get if we're willing to
    sit for two hours on the phone and talk to someone. It's
    delaying the whole process, and that is creating a backlog of
    unsolved, routine problems in addition to and over and above
    and beyond the identity theft problems, which are exploding.
        One specific example, a suggestion I can make to the IRS,
    is that with the professional community, they ought to be doing
    exactly the opposite. They should be requiring professionals to
    get the information online, beef up the security around that
    tool, and that would relieve some of the burden on the phone
    system, which does have to be there to service taxpayers who
    are not represented.
        For example, recently I had to get a copy of a bank
    statement on my personal account. There were only two ways I
    could get it. I could not get it by calling the bank and saying
    please mail it to me. I had to either show up at a branch
    office with a photo identity and prove who I was and they would
    print it for me at that office, or I could go online to my
    account where I have set up the security, three security
    questions and so on, and answer the various security protocols,
    submit a request, and it would be mailed to me at the address
    on record.
        I'd like to point out that enrolled agents, CPAs and
    attorneys are all professional individuals who have made a
    substantial investment in both obtaining a professional license
    and maintaining it on an annual basis. We are known to our
    various licensing agencies, and we have often been the subject,
    depending on the agency, of criminal background checks and even
    fingerprinting. In the case of enrolled agents, we've been
    vetted by the IRS itself. So if the IRS does not have
    confidence in letting us have access to the information,
    they're saying they don't have confidence in their own vetting
    process.
        Furthermore, we know our clients personally, usually
    through many years of working with the same client, sometimes
    decades. As a result, we also have access to a substantial
    amount of financial detail. This is a resource that the IRS
    could be using to quickly identify who is the real John Walker
    or Lori or Bill or Joe or Susie, and they're not doing it.
    Instead, taxpayers are being told that once they file an
    identity theft affidavit, that it may take six months to a year
    before the IRS does its own investigation. That seems totally
    unnecessary.
        Furthermore, I think the delay is absurd because in far
    less time you can get a passport. In four to six weeks, the
    State Department can determine with a high degree of certainty,
    even in this post-9/11 era, who somebody's identity is. And if
    they need to expedite it, they can do it in two or three weeks.
        In the case of tax-related identity theft, one very obvious
    and I think simple solution to establish who is the real
    individual would be to ask them to show up at an IRS office and
    present their passport. And if they don't have a passport, they
    can get one in less time than the IRS conducts those
    investigations. The length of that investigation frustrates our
    clients terribly because they hear nothing for months, and they
    wonder if they're going to come back and say, well, we don't
    believe it's you. Meanwhile, they don't know what else is going
    on with their financial lives.
        There are a number of further examples I can give you, the
    kinds of difficulties we run into dealing with the IRS, and I
    have a great deal of respect for everyone at the IRS I deal
    with. We are professionals. We understand they are dedicated
    people trying to do a very difficult job.
        One case I'm currently working provides some good examples.
    Chris and Jane Stevens--not their real names--are a couple in
    their early 60s. They got into financial difficulty because
    they tried to keep a business running in New Hampshire during a
    downturn in the economy. They got way over-extended on their
    mortgages, ended up in a bankruptcy that dragged on for several
    years, finally came out of bankruptcy last August. Chris, by
    the way, was identified with inoperable but treatable throat
    cancer, so he was out of work. His wife continues to work, Jane
    continues to work.
        In February they received a check in the mail from Sunrise
    Bank in California for $9,855. The accompanying paperwork
    explained that this was their 2014 Federal tax refund, which
    was listed as $9,945 less $90 in processing fees. The letter
    explained that the bank had tried to direct deposit it to the
    account specified on the return but for some reason was unable
    to do so, so they mailed them a paper check.
        The Stevens' immediately knew this was wrong because we had
    not even begun to prepare their 2014 return, and they are very
    honest people. They also knew and were already worried about
    the fact that their identities had been stolen in the Anthem
    data breach just a few weeks earlier. So they contacted me and
    we quickly prepared and filed the identity theft affidavits
    with the IRS. We have received one communication indicating
    that they have received the paperwork, and that was filed in
    February.
        Meanwhile, this looked like we had caught it early and we
    should be able to solve this situation really easily because we
    had the check, the money was not stolen, it was not gone. I
    began investigating how the fraudulent funds could be returned
    to the Treasury, and apparently it's a lot easier to get money
    out of the Treasury than it is to get it back in.
        [Laughter.]
        Mr. Walker. No one had any answers. So I reached out to one
    of my contacts in the IRS stakeholder liaison, which is a group
    that interacts extensively with the professional community, for
    help in answering that question, how do we get the money back
    in. It actually took her a little over a month to find a door
    to put the money back in. She got the name and address of an
    IRS office in Fresno, California where we could send the check.
    So on April 15th--maybe that was a bad omen--we mailed the
    check with a cover letter explaining the situation, included
    all possible identification. Incidentally, much of that was
    also printed on the check. We mailed it Priority Mail,
    signature required, and within a few days we received the name,
    signature, and identity number of the person who signed for it
    at the IRS office.
        We filed their 2014 tax return, which had a balance due,
    and we thought we were pretty well done. One of the obvious
    problems in this whole story is this was someone who already
    had a tax debt. They had a balance due on their 2014 return,
    and yet somehow somebody imitating them with their stolen
    identity was able to get $9,945 shipped out of the U.S.
    Treasury without ever checking the balance due on that identity
    number.
        The first week of August, the Stevens received a call from
    a revenue officer in Holtsville, New York. Because I was their
    representative, I returned the call to Holtsville, spoke with
    this revenue officer, and she wanted the Stevens to return the
    check. That's why she was calling. I explained to her that we
    had mailed the check back in April and how we'd done it and how
    we got the address, where we had sent it and so on.
        Well, she checked--no sign of it on the system. She didn't
    believe it had been returned, or if it had been, it had been
    lost. Her words. There was no record of it. So I said, well,
    look, I convinced her to let me fax over the same package we
    had, the cover letter, a copy of the check, all the
    identification information, the signature of the person who
    signed for it, postal transcript of every place it went between
    New Hampshire and California.
        I sent that fax within the hour, never heard from her. Two
    or three days later I called. Her only response was that she
    hadn't received the fax. She hadn't bothered to call and say
    she hadn't received the fax, which is something normally one
    professional would do with another. I work with attorneys and
    CPAs all the time. If I say I'm going to fax something and I
    don't, or they say they're going to fax something to me,
    there's a follow-up call: 'Hey, I didn't get your fax.' Didn't
    hear anything.
        The revenue officer instead shipped the case over to exam
    with a comment that they could pursue the client for the money,
    and that was the extent of her involvement with it.
        Just a few days later we received a letter, this time from
    the Kansas City campus. So now we've got California,
    Holtsville, New York, and Kansas City involved. Kansas City is
    demanding--this letter demands that the Stevens' either return
    the check or pay the $9,855. The letter was dated August 12.
    They have until September 3rd to do one or the other. We
    obviously can't return a check we've already returned and
    that's been lost by the IRS.
        So at that point, Jane Stevens and I--and it was necessary
    for both of us to get involved so the bank could be sure of
    this--got in touch with Sunrise Bank, their fraud department,
    and we were able to establish that the check, in fact, had
    never been cashed, which was fortunate. We also learned that
    the funds are still in the account at Sunrise Bank, and Sunrise
    Bank is only too happy to return them. The bank does actually
    have a process because Sunrise Bank, as many professionals will
    recognize, is an outfit that processes tax refund third-party
    products for a lot of software companies. They actually have a
    process in place to get funds back to the Treasury.
        Jane authorized them to proceed with that. It will take at
    least 15 days to get that, but it does require first that they
    get cooperation from the IRS and an agreement that they will
    accept the return of the funds. Then we have the small issue of
    making sure they get credited to the Stevens' account.
        In the meantime, however, the bank's fraud department can't
    provide us with any written confirmation to explain to Kansas
    City what actually is happening. That responsibility falls to
    me.
        As I was about to end the conversation with the fraud
    department, the representative said she had one other thing she
    had to point out to me. They are required before they return
    the funds to try again to deposit the funds in the bank account
    specified by the thief on the fraudulent return. I won't say
    anything about that.
        [Laughter.]
        Mr. Walker. The disturbing part in that, however, is that
    the IRS has the power to subpoena the bank records and see all
    it can from that account, see whatever they can learn about it.
    They also have the power to levy that account and seize those
    funds before they go back to the thief, by chance, because if
    they don't get them back, what they are going to do is turn
    around and in the next few months they will be sending my
    client notices that they're going to levy their accounts to get
    the money back.
        That's a fairly typical situation that as professionals we
    have to deal with, and we're frustrated because we are
    professionals. We are willing to work with the IRS. We have a
    wealth of information about our clients. It's a resource that's
    not being put to good use.
        Thank you, Senator.
        [The prepared statement of Mr. Walker follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Ayotte. Thank you. It's pretty shocking when you
    hear that's a typical story, what you've done just for these
    two clients.
        I want to thank both of you for your testimony, and I just
    have a few follow-up questions, and then we'll get to the
    second panel.
        I want to ask you, Ms. Weeks, in terms of what you've been
    dealing with, how did you first learn that Maddi's Social
    Security number was actually used in a fraudulent return' What
    happened to you when you did learn that and tried to call the
    IRS'
        Ms. Weeks. We were basically kind of given the run-around
    by each office. I don't think it was necessarily intentional. I
    really think that everyone we spoke to had no idea where to go
    next. Specifically because she was a minor and because she had
    passed away, people didn't know what our next step should be.
    They were mostly thinking that we were concerned with our
    return and getting the money, but that was not our primary
    concern.
        We could have easily filed and gotten the return back and
    then gone through the process, I was told anywhere from six
    months to a year at that point, to regain Madison's identity,
    but that was never an option for us. We were not going to let
    them--not the IRS but the thieves--take from us the last chance
    we had on paper to say that Madison was our child, that we had
    two children in our family, in our hearts for the rest of our
    lives. We are a family of four, but this was the last chance to
    say on paper that we were a family of four.
        So when we called the offices and pretty much everyone
    said, well, why don't you just file, it can go through, it was
    just a big run-around. It was impossible to prove that she was
    ours, but it was super easy for someone to take her away from
    us. That part didn't make sense to me. I had to provide not
    only my identifying information with a birth certificate,
    Social Security card, driver's license, but I also actually had
    to send over my daughter's death certificate to the IRS to
    prove that she had passed away, as if I would call and state
    that my 7-year-old child was gone when she was not. I had to
    provide multiple copies of that information to multiple
    agencies.
        Senator Ayotte. Different people.
        Ms. Weeks. Different people within the same agency.
        Senator Ayotte. So you were never assigned one point of
    contact.
        Ms. Weeks. Never. The only time I was was when I started
    working with your office and the Tax Advocate's office was
    assigned to me. Other than that, I just kept getting pushed
    from one person to the next person to the next person, and
    online there was very little help as well. It wasn't even a
    resource that says, okay, this has happened to you and these
    are the steps you need to take. It was all over the board and
    no one website could give us concrete steps as to your child's
    identity has been stolen, this is what you need to do next,
    after this you do this, make sure you keep copies of this.
        Like I said, the police department made us feel like we
    were being kind of silly filing a police report with them. But
    then speaking with someone in the IRS office, they said, oh, if
    you hadn't gotten that, we couldn't have moved forward. But
    even the police department, our tax preparer, none of them were
    100 percent sure if we even needed to do that, but we wanted to
    cover all of our bases, so we did.
        Senator Ayotte. And I know that, as I understand it, you've
    heard from other families that have gone through this as well'
        Ms. Weeks. Many.
        Senator Ayotte. Unfortunately.
        Ms. Weeks. Yes. I am a part of several online support
    groups for grieving families, and when we started going through
    this, just like I do a lot, I shared on the website what we
    were going through, and very quickly the page filled up with
    'Us too, us too, us too.' And if it wasn't their child, it was
    their sister's child's identity had been stolen. Multiple
    friends on Facebook and through personal conversations spoke to
    me about their family members going through very similar
    things.
        A friend of mine, her cousin passed away several years ago
    when he was 19 years old, and his identity was stolen, and the
    IRS refused to correct the fraudulent return because a check
    had been mailed and the person who stole his identity had
    cashed it, and they told his parents, his grieving parents,
    that they couldn't prove that they weren't the ones that
    received the check and cashed it, so they refused to correct
    the situation. It's been five years and they are still fighting
    for their son's identity. It's not about the money for them,
    just like it wasn't for us. It was about saying that this child
    is ours and somebody taking that from you.
        Senator Ayotte. Thanks.
        Mr. Walker, you had referenced the history of having your
    professional history and dealing with this, how things have
    changed. When has this changed' You used to be able to get
    better access for your clients to be able to help manage their
    day-to-day tax issues, but also resolve issues. So can you give
    us some perspective on----
        Mr. Walker. Yes. In the last 18 to 24 months is when we
    started seeing this freeze come on. When you work a client's
    issue for multiple years, as I do, you're constantly going back
    to make sure payments have been made and applied to the right
    year and so on. So you need that access to see those records.
        Senator Ayotte. And how has the response time been, as
    someone who is a professional? You talked about an hour or two
    trying to get through. Has that been your historical
    experience, or do you think that----
        Mr. Walker. Phone service has always been time-consuming.
    There are certain times of the day, if you time it carefully,
    you can get through faster than others, and as a professional
    you learn when those times are.
        One of the problems, of course, with the phone service is
    that the call gets routed anywhere, all over the country.
    You're never talking to the same individual, so you don't get
    the same answer. In fact, you can call as a professional trying
    to settle a payment plan, and they'll tell you they want the
    information on a 433A. You call back when you've got that
    financial information on a 433A and that person says, oh, I
    only work a 433F, and on it goes.
        I had one client who owed money. He made seven calls to try
    to pay the balance due and find out what he had to do. He got a
    different story from every collection agent, and then he came
    to me. It took me five calls. This was somebody who wanted to
    pay in full his tax debt in four years, and it was an argument
    over whether his financial information was going to be on an A,
    a B, an F, or one of the others. There are five different
    433's.
        Senator Ayotte. And how do you think we could resolve that'
    It sounds like getting back to allowing professionals to have
    tools that they've had in the past to communicate on behalf of
    their clients, and also more consistency in terms of who you're
    dealing with when you call, as opposed to being bounced around?
        Mr. Walker. Yes. There should be, when you're working these
    cases, it would make sense to have one point of contact.
        Senator Ayotte. Assigned to you.
        Mr. Walker. Yes. It would speed things up. If we had access
    to the online tools, the thing is we have the knowledge and the
    experience to read those transcripts, to know what's going on,
    to do the investigation. So when we call we're not saying, hey,
    we've got this problem. We're calling saying the estimated tax
    payments for 2013 were applied to 2008 and they shouldn't have
    been, that's supposed to be these payments. We call with
    solutions.
        Senator Ayotte. Well, I want to thank both of you for
    taking the time to be here today to testify before this
    committee. It's very important to hear the perspective of what
    are the difficulties that taxpayers are facing, and I know that
    there are many of my constituents who are here, who have
    written me, who have experienced, unfortunately, similar
    situations where they feel that they've gotten the run-around.
        So I want to thank both of you for being here, and I'm
    going to call the second panel up, and I'm glad that our second
    panel certainly were able to be present and hear directly your
    experiences because they're in a position where, hopefully,
    they can address these concerns. So thank you both very much
    for spending the time here.
        Ms. Weeks. Thank you for this opportunity.
        Senator Ayotte. Thank you.
        Mr. Walker. Thank you, Senator.
        Senator Ayotte. Appreciate it.
        [Pause.]
        Senator Ayotte. I want to thank you for being here today,
    and I appreciate that you had the opportunity to hear from Ms.
    Weeks and Mr. Walker and hear the experiences that they've had
    with identity theft, either themselves, unfortunately, or on
    behalf of their clients.
        First I would like to welcome the IRS Commissioner, John
    Koskinen, as well as the Treasury Inspector General, J. Russell
    George, for Tax Administration for the Department of the
    Treasury, and Mr. Christopher Lee, a Senior Attorney Adviser
    for the National Taxpayer Advocate Service, and thank all of
    you for being here today.
        I would ask you, I know we have your written testimony, and
    certainly you can summarize that if you'd like to.
        So I would ask the Commissioner of the IRS to offer his
    testimony first.
        Mr. Koskinen.

    STATEMENT OF HONORABLE JOHN A. KOSKINEN, COMMISSIONER, INTERNAL
                            REVENUE SERVICE

        Mr. Koskinen. Thank you, Senator Ayotte. Thanks for the
    opportunity to discuss the IRS' efforts to combat stolen
    identity refund fraud and to protect taxpayer information from
    cyber-security threats.
        Securing our systems and protecting taxpayer information is
    a top priority for the IRS. Over the past few years we have
    devoted as much time and attention to this challenge as
    possible, even with our constrained resources. Since 2010, we
    have increased our dedicated spending in this area from just
    over $20 million to $430 million, and we've been making steady
    progress both in terms of protecting against fraudulent refund
    claims and prosecuting those who engage in this crime.
        Thanks to the work of our Criminal Investigation Division,
    over 2,000 individuals have been convicted on Federal charges
    related to refund fraud involving identity theft, over the past
    few years. We currently have about 1,700 open investigations
    being worked by more than 400 IRS criminal investigators. And
    since 2013, we have initiated more than three dozen cases that
    involve one or more victims who are New Hampshire residents.
        The total number of identity theft-related convictions and
    open investigations is actually larger than what I just
    described, when you factor in the important work being done by
    law enforcement agencies at the state and local level, in New
    Hampshire and around the country. The IRS works in close
    collaboration with those agencies.
        During calendar year 2014, the IRS protected more than $15
    billion in refunds, including those related to identity theft.
    We continue to improve our efforts at stopping fraudulent
    refunds from going out the door. For example, we have improved
    our processing filters, allowing us this year to suspend about
    3.2 million suspicious returns and hold them for further
    review, an increase of over 500,000 from the year before.
        And we continue to help taxpayers who have been victims of
    identity theft. The IRS has 3,000 people working directly on
    identity theft-related cases, and we've trained more than
    35,000 employees who regularly work with taxpayers so that
    these employees have the tools to help with identity theft
    situations when they arise.
        In addition, we recently completed our efforts to
    centralize victim assistance with our new Identity Theft Victim
    Assistance Organization. This has allowed us to consolidate
    work being done by four different parts of the IRS into one
    business operating division. It's also important to note that
    we provide taxpayers, victimized by identity theft with a
    single point of contact at the IRS via a special toll-free
    telephone line. Taxpayers who become identity theft victims in
    2015 can expect to have their situation resolved in less than
    120 days, far more quickly than in previous years when cases
    could take over 300 days to resolve. I am a little concerned
    about references made to six months or longer to resolve those
    cases. That's not our experience overall.
        While this marks a significant improvement, we are
    continuing to work to find ways to shorten this time and ease
    the burden identity theft places on these victims. In 2014, the
    IRS worked with victims to resolve and close approximately
    826,000 cases of identity theft.
        While the IRS has improved its ability to stop individuals
    from perpetrating stolen identity refund fraud, we continue to
    see an increase in organized crime syndicates around the world
    engaging in these crimes. These cyber-criminals have been able
    to gather significant amounts of personal information as a
    result of data breaches at sources outside the IRS, which makes
    protecting taxpayers increasingly challenging and difficult.
        A good illustration of this problem is the unauthorized
    attempts to gain access to our Get Transcript application
    earlier this year. In this instance, the criminals already had
    accumulated large amounts of stolen taxpayer information from
    other sources which allowed them in some cases to access
    individual prior year tax returns. We shut down the Get
    Transcript application and it will remain disabled until we
    make modifications and further strengthen security for this
    application.
        To improve our efforts against this complex and evolving
    threat, the IRS held an unprecedented sit-down meeting in March
    with the leaders of the electronic tax industry, the software
    industry, and state tax administrators. All of us agreed to
    leverage this public-private partnership to help battle stolen
    identity refund fraud. Motivating us was the understanding that
    no single organization can fight this type of fraud alone. We
    spent 12 weeks studying what needed to be done, and in June we
    announced new steps to provide stronger protections for
    taxpayers and the nation's tax system. The critical point for
    taxpayers to understand is that new protections will be in
    place by the time they have to file tax returns in 2016.
        The result is that the Federal Government, states and
    private industry will stop more fraud related to identity theft
    up-front, and to the extent fraudulent returns do get through,
    we will have better post-filing analytics to determine ways to
    adjust our security filters. We will also continue to enhance
    our methods of tracking down the criminals and add to those
    2,000 individuals already serving jail time for Federal tax-
    related identity theft.
        Going forward, the IRS and its partners will continue
    collaborating to address longer-term issues and build lasting
    changes.
        Congress, as you note, has an important role to play in the
    fight against stolen identity refund fraud. Adequate funding
    for the IRS is critical. Congress can also help by passing
    several legislative proposals. One of the most important of
    these would accelerate the due dates of third-party information
    returns such as W-2's that would allow us to match these
    documents against income tax returns earlier in the tax-filing
    process, and would help us more quickly spot errors and detect
    potential fraud.
        Senator Ayotte, this concludes my statement. I'd be happy
    to take questions.
        [The prepared statement of Mr. Koskinen follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Ayotte. Thank you, Commissioner.
        We will now hear from the Treasury Inspector General, J.
    Russell George, for the Tax Administration Department of the
    Treasury.

    STATEMENT OF HONORABLE J. RUSSELL GEORGE, INSPECTOR GENERAL FOR
             TAX ADMINISTRATION DEPARTMENT OF THE TREASURY

        Mr. George. Thank you, Senator Ayotte, for hosting this
    hearing and the opportunity to provide testimony on the
    important subject of identity theft and the impact it has on
    both the Internal Revenue Service and taxpayers.
        The Treasury Inspector General for Tax Administration, or
    TIGTA, has provided ongoing oversight and testimony on tax
    fraud-related identity theft. Our audit work shows that while
    the IRS is making progress in detecting and resolving identity
    theft and assisting victims, improvements are still needed.
        My comments today will focus on the results of our prior
    audit work and our ongoing work to assess the IRS' progress on
    this issue.
        The IRS continues to make progress on both preventing
    fraudulent tax returns from entering the tax processing system
    and on detecting fraudulent tax returns during processing. The
    IRS reported that in processing year 2014, and that's when they
    consider the tax returns from 2013, it detected and prevented
    over $24 billion in identity theft refund fraud.
        The IRS continues to expand the number of filters used to
    detect identity theft refund fraud at the time tax returns are
    processed. For example, the IRS increased the number of filters
    from 80 filters during processing year 2013 to 114 filters
    during processing year 2014. As of September 30th, 2014, these
    filters were used to detect over 830,000 tax returns and
    prevented the issuance of over $5 billion in fraudulent tax
    refunds.
        TIGTA has previously identified large volumes of undetected
    potentially fraudulent tax returns with tax refunds issued to
    the same addresses or deposited into the same bank accounts. In
    response, the IRS developed and implemented a clustering
    filter. Using this tool, the IRS reported that as of early
    October 2014, it had identified approximately 517,000 tax
    returns and prevented the issuance of over $3 billion in
    fraudulent tax refunds.
        In addition, beginning with the 2015 filing season, the IRS
    implemented restrictions to limit the number of deposits to a
    single bank account. TIGTA is currently evaluating whether this
    is working as intended.
        Notwithstanding improvements in its detection efforts,
    access to third-party information, both income and withholding,
    is the key to enabling the IRS to prevent the continued
    issuance of billions of dollars in fraudulent tax refunds. Most
    of the third-party income and withholding information is not
    received by the IRS until well after tax return filing season
    begins. So, for example, the annual deadline for filing most
    information returns--we're talking about the W-2s and the
    1099s--with the IRS is March 31st. Yet taxpayers can begin
    filing their tax returns as early as mid-January each year. For
    the 2014 filing season, the IRS had received over 90 million
    tax returns as of March 28th, 2014. Legislation would be needed
    to accelerate the filing of the information returns.
        One practice that is designed to protect taxpayers from
    being victimized again the following year is the issuance of
    identity protection personal identification numbers. However,
    TIGTA reported in September 2014 that over 530,000 eligible
    taxpayers were not provided these numbers as required.
    Additionally, we have previously reported that identity theft
    victims experienced long delays in resolving their tax
    accounts. We found that in Fiscal Year 2013, the IRS took an
    average of 278 days to resolve the tax accounts. Our review
    also identified that the IRS made errors on the tax accounts of
    victims of identity theft, resulting in delayed refunds and
    requiring the IRS to reopen cases and take additional actions
    to resolve the errors.
        Recently, the IRS announced that unauthorized users were
    successful in obtaining access to over 350,000 taxpayer
    accounts using its Get Transcript application. The IRS believes
    that some of this information may have been gathered to file
    fraudulent returns during the upcoming 2016 filing season.
    TIGTA continues to investigate this incident, coordinating with
    other Federal law enforcement agencies. TIGTA has an audit
    ongoing to evaluate the IRS' assistance provided to victims of
    the Get Transcript data breach.
        We at TIGTA, Senator, remain concerned about the ever-
    increasing attempts to defraud taxpayers through identity theft
    and other scams. Because of the importance of these issues, we
    plan to provide continuing audit coverage of the IRS' efforts
    to prevent tax identity theft and will continue to investigate
    any instances of attempts to corrupt or otherwise interfere
    with the nation's system of tax administration.
        Senator Ayotte, thank you for the opportunity to provide an
    update on our work on this critical tax administration issue
    and to share my views.
        [The prepared statement of Mr. George follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Ayotte. Thank you.
        Mr. Christopher Lee, Senior Adviser Attorney for the
    National Taxpayer Advocate Service.
        Thank you, Mr. Lee.

    STATEMENT OF CHRISTOPHER LEE, SENIOR ATTORNEY ADVISER, NATIONAL
                       TAXPAYER ADVOCATE SERVICE

        Mr. Lee. Senator Ayotte, thank you for inviting me to speak
    today about tax identity theft. When I joined the Taxpayer
    Advocate Service in 2004, one of my first assignments was to
    look into how the IRS was dealing with the small but growing
    problem of identity theft. Since then, the National Taxpayer
    Advocate has included identity theft as the most serious
    problem in nearly every annual report she has delivered to
    Congress.
        Today, identity theft cases account for approximately one-
    quarter of all TAS case receipts. These cases are usually very
    complex, often involving many years and involving multiple
    issues. In TAS, we assign a single case advocate to work with
    the taxpayer from day one until all related issues have been
    resolved. The taxpayer has the case advocate's direct phone
    number and deals solely with this case advocate throughout, no
    matter how many IRS employees are involved in the back end.
        I am pleased to report that TAS resolves identity theft
    cases in about 66 days. To get an accurate sense of how long it
    takes the IRS to work an identity theft case, TAS reviewed a
    representative sample of approximately 400 identity theft cases
    closed by the IRS during the month of June 2014. We found that
    the average cycle time was 179 days, or about six months. We
    reported this and other key findings in Volume II of the
    National Taxpayer Advocate's 2014 Annual Report to Congress
    that we released in December.
        Apart from the time and aggravation in having to prove
    one's own identity again and again, the most significant impact
    to a victim of tax-related identity theft is the delay in
    receiving his or her refund. With the average refund amount
    being approximately $2,700, getting access to their tax refund
    is a big deal, particularly for low-income taxpayers, which is
    why we have been pushing the IRS to resolve these cases
    promptly.
        Some victims also experience consequences when other
    Federal agencies or private businesses rely on IRS data. For
    example, the IRS generally will not release account transcripts
    while an identity theft case is pending, so students applying
    for financial aid and homeowners applying for a mortgage may
    face additional obstacles.
        Despite a memo from the IRS Office of Chief Counsel
    concluding that the IRS may share with the victim a copy of a
    return filed by an identity thief, the IRS continues to deny
    such requests. Commissioner Koskinen recently committed that
    the IRS would allow identity theft victims to obtain redacted
    copies of tax returns filed under their SSN. We support this
    decision and look forward to the adoption of the new
    procedures, and we thank you for your involvement in this
    decision.
        In many instances, the IRS is the first to learn of the
    identity theft. In 2011, we recommended that when the IRS
    discovers that a taxpayer's SSN is used without authorization
    to file a tax return, it immediately notify the SSN owner.
        Last summer the IRS conducted a pilot program and notified
    approximately 25,000 taxpayers that their SSN had been misused
    for tax purposes. The IRS is currently evaluating
    recommendations from the pilot, and we urge the IRS to adopt
    the recommendation that it systemically issue letters to
    taxpayers informing them that someone has attempted to file a
    tax return using their SSN.
        Thus far, I have focused on the victim assistance aspects
    of identity theft. Now I will share some thoughts on what the
    IRS is doing to prevent identity theft from occurring in the
    first place.
        The IRS uses targeted filters to suspend the processing of
    tax returns that it suspects were filed by identity thieves.
    While we support the use of data-driven models to detect
    suspicious tax returns, the IRS has an obligation to
    sufficiently test these filters prior to rolling them out. This
    filing season approximately one out of three returns suspended
    by one such program, the Taxpayer Protection Program, were
    false positives, meaning that hundreds of thousands of
    taxpayers who had filed legitimate returns had to spend time
    contacting the IRS to verify their identity. This resulted in a
    severe backlog of calls to the Taxpayer Protection Program
    phone line, and in some weeks only 1 in 10 callers got through
    to an assister. We cannot afford to have a repeat of this
    filing season when far too many legitimate filers were
    inconvenienced and then were unable to reach an assister when
    they called the number instructed.
        All this does not paint a pretty picture, but there is some
    good news. The IRS has recently reorganized its identity theft
    victim assistance units, moving toward a more centralized
    approach for which our office has long advocated. TAS will be
    involved in the reengineering of identity theft victim
    assistance procedures this fall, and we will reiterate our
    recommendation that when a case involves multiple issues, one
    IRS employee should oversee the case to make sure the problems
    are handled in a coordinated manner.
        I appreciate the opportunity to testify today and would be
    happy to answer your questions.
        [The prepared statement of Mr. Lee follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Senator Ayotte. Thank you, Mr. Lee.
        Commissioner Koskinen, first of all--you heard Ms. Weeks'
    testimony, and I wrote to you, really at her urging, to ensure
    that taxpayers could get a copy of their fraudulent return. You
    have agreed now to do that. I have to tell you, since you
    agreed to do that, people across the country have been
    contacting my office on this issue. So when will this happen'
    Because I know not only Ms. Weeks, but many taxpayers, they
    want to know how their information was misused so that they can
    take steps to protect themselves, and obviously I think all of
    us, if we were a victim, would want to know the full extent of
    how such personal information is being abused.
        Mr. Koskinen. And as you know, we support that need. We
    think taxpayers do need to be able to have access to that
    information, if for nothing else, as Ms. Weeks noted, just to
    close the circle and to understand what's been involved.
        Senator Ayotte. I think it can also help you understand
    what you need to do to protect yourself, too.
        Mr. Koskinen. Yes. For instance, with Get Transcript, we
    immediately, as soon as we found there was an issue, notified
    taxpayers. I do think that taxpayers need to get notice. I
    think they need to have access to the information.
        Since you and I talked it has turned out that, like
    everything, it's more complicated to get the system to work
    than I had hoped. Part of it is because we have an obligation
    under Section 6103 to protect taxpayer information. So the
    complication is--and we're talking about, as you know, hundreds
    of thousands of identity theft cases a year--that when a return
    is filed, there may be more than one taxpayer's Social Security
    number involved. For instance, in Ms. Weeks' case, where a
    child is taken as a dependent, what's happening at the top of
    that fraudulent return is that there are other stolen
    identities. So that information can't be provided because those
    are real people. It's just that somebody has stolen that
    information and impersonated them. So we can't provide that
    information to any of the other taxpayers on the return.
        Similarly, attachments, whether they're W-2's or other
    forms, oftentimes have stolen information from other taxpayers.
    We are not allowed to share, for instance with Ms. Weeks, the
    other taxpayer who has had their information stolen.
        To do it manually, if you think about it, you'd say, well,
    I could redact that information pretty quickly. But what we
    need is a system that will do that automatically so that we can
    regularly provide this information.
        I had hoped we'd get that up sooner. I am told that in a
    few weeks we will be able to, as a regular matter for any
    taxpayer, be able to provide that.
        If your identity is stolen and it is the identity used for
    filing the return, then that information is all available to
    the taxpayer.
        Senator Ayotte. They can get everything if they're using
    their identity.
        Mr. Koskinen. If you're using your identity. In cases like
    Ms. Weeks', where it's simply a stolen identity to add to a
    deduction but it's not the return, that's where it gets more
    complicated as to how much information is there. In Ms. Weeks'
    case, for instance, the only use of the identity, and that's
    generally the case for a child, is just to use the child's
    Social Security number. There is no other information about the
    child on that return. She's been a good catalyst for all of us
    to try to get this problem solved. In her case, when she gets
    the copy of the return, the information will all be redacted
    because the data belongs to the other taxpayer-victims----
        Senator Ayotte. So what kind of investigation is being done
    to ensure that the taxpayer information at the top isn't just
    another innocent taxpayer who has been stolen but someone who
    may be involved in some way in the perpetration' Is there a
    follow-through done'
        Mr. Koskinen. Yes.
        Senator Ayotte. Because I think, at the end of the day,
    we're all appalled at what's happened to the Weeks family, and
    we want to make sure we get those who have committed this
    horrific crime and hold them accountable.
        Mr. Koskinen. Yes. The challenge for the entire economy in
    a digital age is the tremendous amount of personal data that's
    available to criminals. The estimate is over 100 million
    Americans have data out in the hands of criminals. The Dark
    Net, as it's called, the underside of the Web, has an estimated
    five times as much information as the entire Public Web. There
    are criminal syndicates in Russia, for instance, reputed to
    have 1 billion user identity's and passwords.
        So what's happening with children, children's identity's
    and Social Security numbers are used in schools, they're used
    in hospitals, they're used with regard to health care. On
    certificates, when children or adults die, that information is
    available. Congress supported us and we shut down the
    availability of the Death Master File, because what criminals
    want is to file a return where there isn't going to be a
    competing return. They increase their chances of getting
    through. So that's why they like people who are deceased, poor
    people who are not likely to file, elderly people who are not
    likely to file.
        In any event, the bottom line is taxpayers deserve to have
    as much information about that false return as we can provide
    them. As I say, within the next few weeks I am advised, because
    I've asked this question again, that we will have a system that
    will allow people automatically to get that information.
        Senator Ayotte. So, Commissioner, in the next few weeks,
    what can I expect as a deadline?
        Mr. Koskinen. Well, I asked that question, and we have a
    lot going on. Our people have said that they would like to
    certainly before October is over. In other words, in the next
    six to eight weeks we should have that system. It's already
    being built. We've got the legal authority for it. We hope to
    then regularly be able to provide that information before we
    get very far into the fall. I could not pin them down any
    further because we're also doing all of the IT work to get
    ready for the next filing season.
        Senator Ayotte. All right. I need you to pin them down.
        Mr. Koskinen. All right, I will.
        Senator Ayotte. Because this is important.
        Mr. Koskinen. I will start by saying that if it's not ready
    by the end of October, I will want to know. If we can get it
    earlier than that, we will do that.
        Senator Ayotte. Well, we'll be following up.
        Mr. Koskinen. And that would be fine.
        Senator Ayotte. Because this is incredibly important, not
    just to Ms. Weeks, but I know many of the taxpayers that are
    here today who want more information about how their personal
    information has been misused.
        Mr. Koskinen. Right.
        Senator Ayotte. So this is one where I hope you'll make it
    a top priority to get this done.
        Mr. Koskinen. Right. And one of the things we are concerned
    about is that this is information that the criminals have
    gotten from somewhere else. So when they get enough information
    to file a false return, or to access a Get Transcript account,
    our major concern for taxpayers is to understand that data is
    out there and they need to know what's on the tax return, but
    more importantly, they need to then take steps to protect their
    information.
        Senator Ayotte. Absolutely.
        Mr. Koskinen. It goes to changing your identity, changing
    your passwords, not using the same----
        Senator Ayotte. It's a huge process and a big rigmarole.
    When you become the victim of identity theft, all your credit
    information, everything is impacted.
        Mr. Koskinen. Yes. And so whatever we can do to be helpful,
    we are going to try to do. It's a traumatic event for
    taxpayers.
        Senator Ayotte. It is. I'm going to hold you to that.
        Mr. Koskinen. That's fine. I'm happy to be held to that.
        Senator Ayotte. I appreciate it.
        So, I wanted to follow up, with Mr. Lee, and Inspector
    George. I know the Commissioner says we're going to assign one
    point of contact now, and that sounds new to me on this,
    because we heard the story from Ms. Weeks, we heard the story
    from Mr. Walker as well, about the jumping around and the
    rigmarole that people are going through when they're trying to
    correct the record--in Mr. Walker's case, when his clients
    actually tried to return money to the Treasury.
        So when will this get in place?
        The other question I have is I know you said 120 days, but
    just listening to everyone here I heard 120 days, and then I
    heard 278 days, and then I heard 179 days. I bet you if I went
    out into that audience and asked folks out there that were
    victims of identity theft, they'd be talking about hundreds and
    hundreds of days, unfortunately.
        So can you clarify that for us and how we're going to get
    more responsive here and make it easier for people?
        Mr. Koskinen. Yes. Let me just clarify one thing. As noted,
    we have consolidated what used to be in four different
    departments of the IRS to try to get a single point of
    operations and contact. The issue that the Taxpayer Advocate,
    Nina Olson, and I continue to discuss is, whether within that
    now centralized unit--which we think will be much more
    efficient and allow us to move faster--whether you should have
    an individual person answering the phone.
        The Taxpayer Advocate, as Mr. Lee pointed out, suggests
    that if there are complications, there ought to be one person.
    Our sense is if we can build the right system--for instance,
    when you call an airline and talk to someone, when you call
    back you don't get the same person, but they have a system that
    allows them to know exactly what you said the last time you
    called. We are not quite there yet, but our hope is, with a
    little bit of funding, that we can actually build a record so
    that when you call the next time your previous discussion is
    already readily available. Because otherwise, that's when
    people think a single person is good.
        The problem with a single person, the reason airlines and
    Amazon don't do that, is that when you call back, they may be
    on vacation, they could be at lunch, they could be on another
    phone line. But I take the point, that there's nothing more
    frustrating, and nothing has been more frustrating, than being
    moved from one part of the agency to another.
        Senator Ayotte. Right. It's like you told your story once,
    and then you get someone new and they don't know anything about
    it.
        I wanted to allow Mr. George and Mr. Lee to comment on that
    as well.
        Mr. George. As it relates to the timing, Senator, the IRS
    issued guidance in Fiscal Year 2013 to inform taxpayers, for
    their employees, IRS employees to inform taxpayers that these
    matters would be resolved in 180 days.
        Senator Ayotte. Okay.
        Mr. George. What we uncovered is that during that
    timeframe, Fiscal Year 2013--oh, and what they also did, the
    IRS informed the oversight board, the IRS oversight board that
    they were resolving these matters in 120 days. So that's
    where----
        Senator Ayotte. So in other words, if I'm a victim of
    identity theft, the IRS is saying 180 days.
        Mr. George. That was the guidance that they issued.
        Senator Ayotte. That was the last guidance on the issue.
        Mr. George. Unless there was subsequent guidance, and that
    one I can't say for the record.
        Senator Ayotte. So what is really happening?
        Mr. George. Well, what is happening is the information that
    was reported out, the IRS eliminated an entire subset of cases
    closed during Fiscal Year 2013. The information that they
    relayed was cases that were open and closed in Fiscal Year
    2013, as opposed to the previous cases that had come to their
    attention in Fiscal Year 2012 and prior that were also closed.
    So that eliminated almost two-thirds of the cases that were
    outstanding that they reported out on. So that's why there's a
    difference of opinion as to the number of cases.
        Senator Ayotte. What are you hearing, Mr. Lee, in terms
    of----
        Mr. George. Or the number of days, rather.
        Senator Ayotte. I'm sorry. Mr. Lee, and then go ahead if
    you have more to offer, Mr. George.
        Mr. Lee. Yes, I think there are a couple of things going
    on. Number one, the IRS is continually improving their
    processes. So I think TIGTA has looked at the cycle time of
    identity theft cases in each of the past three years, and the
    first year, I guess Fiscal Year 2008, before they came out in
    2013 they came out with an estimate of 414 days, and then the
    following year they came out with reports saying the average
    cycle time was 212 days, and then earlier this year the cycle
    time was reported as 278 days. So clearly, the IRS is improving
    its processes.
        Especially in 2013 the IRS has new processes, and I believe
    even in TIGTA's report where they estimate 278 days, they used
    a figure of 174 days with the new procedures. So I think six
    months is the most accurate estimate. We conducted a thorough
    review last summer where we looked at 400 cases selected at
    random of all IRS cases closed in June 2014, and we came out
    with 180 days.
        We've heard reports from certain groups within the IRS
    saying they were going to close their cases in 120 days, which
    is great. But what we found is that the IRS often looks at
    cases on a module-by-module basis. So even if that particular
    function was able to close cases in 120 days----
        Senator Ayotte. It's not fully closed.
        Mr. Lee.--it doesn't mean that all the taxpayers' issues
    were resolved in that 120 days. So I believe our estimate----
        Senator Ayotte. So let's get to the bottom line here, would
    we all agree that the number of days is unacceptable that
    people are waiting right now? Because I'm hearing a number of
    six-month stories, if not longer.
        Yes or no? Mr. Lee?
        Mr. Lee. Yes, I feel that six months is not acceptable, but
    it's obviously much better than 278 days.
        Senator Ayotte. It's all relative. But if you are a victim,
    that's a long time, especially if your tax refund. We've got
    constituents, people who need these tax refunds to pay
    important bills to keep going.
        Mr. George. And I'm sure that the Commissioner will address
    this further, and there is no question that it's unacceptable,
    but the IRS is restricted by resources, Senator. There's no
    question about that. Additional resources would allow for more
    attention to this matter. During the tax filing season,
    individuals who would otherwise work on these types of cases
    and assist taxpayers have to now take on phone questions,
    responsibilities to respond to questions about filing tax
    information, and so they have to put aside their cases working
    on tax-related identity theft.
        But again, I'll refer to the Commissioner.
        Senator Ayotte. Commissioner.
        Mr. Koskinen. Well, I don't want every problem when I
    testify to be tied to the budget, but the Inspector General is
    correct. Ultimately, this is a question of manpower or person
    power in terms of addressing it.
        I think what you've heard, we'd all agree, is the process
    is much better than it was three or four years ago. As the
    Inspector General said, part of what happens in the measuring
    of time is the old cases took longer. If you add them into the
    newer cases, which take less time, the average is still higher.
        Our goal is to get it down to 120 days or less for cases
    when they start. We still have cases thattake longer. Even 120
    days we aren't satisfied with. But as the Inspector General
    said, we think the consolidation of the four departments into
    one will allow us to move more quickly. But ultimately, in the
    middle of tax season when we're processing 150 million returns,
    the fact that we have several thousand fewer people on the
    phones means that the system bogs down.
        Senator Ayotte. Mr. Lee.
        Mr. Lee. Senator, I just want to mention that the Taxpayer
    Advocate Service is also faced with budget constraints. But if
    a taxpayer is facing economic burden, they are able to come to
    us and we've been able to get them the refund in a much shorter
    time, in about two months. So that is one option. We don't want
    all of the IRS' identity theft cases, but when the taxpayer has
    a hardship or economic burden, we are happy to take on their
    case.
        Senator Ayotte. I appreciate it. And I just want to also
    make sure that we clarify. As I understand the resource issue,
    I know that the amount committed to taxpayer services was
    actually the same, because you and I have kind of gone around a
    little bit on this, from 2014 to 2015. But as I understand it,
    the agency chose to reallocate about $133 million in user fees
    from taxpayer services to operation support accounts, most of
    which has gone to implement the new health care law.
        Mr. Koskinen. Correct. What's important to understand is
    that we have user fees that historically have been used as a
    buffer to allow us to fund unfunded issues as they come up.
    This year the ABLE Act was passed in December. We don't have a
    budget for that. The health coverage tax credit has been
    passed, and we don't have a budget for that. Normally we'd
    apply user fees.
        Well, in the last three or four years, because the taxpayer
    services, account has never been fully funded, we used user
    fees to support it, and this last year we used $50 million to
    support it. But that was about $100 million less than we used
    the year before, and you're right, we had to put that into
    supporting the establishment of the Affordable Care Act, both
    because it's a statutory mandate and also, for taxpayers, we
    had to be able to run the filing season and process 5 or 6
    million returns that, in fact, reconciled the advance premium
    tax credits received.
        So we have enforcement, we have taxpayer service, we have
    IT operations and maintenance, and as the budget has been cut
    for five years, we had to balance where we put these funds.
        Senator Ayotte. I just want to make sure we're clear,
    though, in terms of what was allocated between 2014 and 2015
    for taxpayer services. That number has remained the same, but
    you had other responsibilities added.
        Mr. Koskinen. That number as an appropriation remained the
    same, but because of the fact that the appropriation overall
    was cut, it meant that the $100 million that would have gone
    into taxpayer services----
        Senator Ayotte. Right. But when Congress put the money for
    the services, that's where they put the same amount of money,
    right?
        Mr. Koskinen. Right, and when I testified to the
    appropriators, I said if we were held flat our taxpayer service
    was going to be at the 50 to 60 percent level. When it turned
    out that we weren't held flat, that in fact our budget was cut
    by $350 million, we had no choice but to take $100 million to
    fund the statutory mandate passed by Congress.
        Senator Ayotte. To deal with the new law, the Affordable
    Care Act.
        Mr. Koskinen. To deal with the new law, yes. This year we
    are having to take money out of enforcement and taxpayer
    services, to fund other statutory unfunded mandates. The ABLE
    Act is a perfectly good act. The Health Coverage Tax Credit is
    a perfectly good act. We have no money provided by Congress to
    fund the implementation of those programs. We have to do it.
    The only place it comes from is either enforcement, taxpayer
    services, or our ongoing IT work.
        Senator Ayotte. So let me ask the Inspector General, you've
    made a number of recommendations that you believe the IRS could
    implement to save money. What thoughts do you have on that?
        Mr. George. What I'd like permission to do, Senator, is to
    provide you in writing a thorough listing, but I'll just give
    you what I think would be the most helpful way for the IRS to
    do its mission and for the U.S. Treasury to benefit.
        Senator Ayotte. Sure.
        Mr. George. When the information reported to the IRS on
    income is provided by a third party, we have uncovered during
    the course of all the audit work that we've done and from
    outside sources that the compliance rate among taxpayers who
    fall into that category--and again, the category is somebody
    else is reporting that the taxpayer earned $100 that year or
    that pay period, that year--it's almost 98 to 99 percent
    compliance rate.
        At the opposite end of that spectrum are people who operate
    businesses on a cash-only basis who self-report, the compliance
    rate is under 20 percent.
        So if there was a requirement for everyone to have some
    form of information sharing by an outside or independent party,
    that would tremendously empower the IRS and the American
    taxpayer overall.
        Another study, and this was done professionally. If you are
    asked "Should you pay all the taxes you owe to the Federal
    Government'' again you have a 90-plus rate, 'Yes, I should.' If
    the question is changed, Senator, slightly to say, 'What if
    your neighbor down the block, Ms. Jones, isn't paying
    everything that she owes'' then the compliance rate goes down
    dramatically, because if she isn't paying everything, then why
    should I pay everything?
        So the bottom line, again, is third-party reporting. Then
    there's access to the new-hire database which is held in the
    Department of Health and Human Services, so that too could
    provide the IRS with tools to determine whether the information
    they're receiving is accurate, whether the person actually did
    earn what he or she said in the tax return that they filed. And
    then, of course, working on a lot of the refundable credits and
    the like, making sure people who----
        Senator Ayotte. Additional child tax credit, earned income
    tax credit. Yes, we've talked about the fraud and issues that
    need to be resolved. They could be better addressed there. I
    know you've issued reports about that.
        Mr. George. Yes.
        Senator Ayotte. And I also have legislation to address some
    of that.
        Mr. Koskinen. I would just add one thing, because we have
    an obligation to be as efficient as we can. We have an
    obligation to our employees. We have a great workforce who are
    committed to providing taxpayers the best service we can.
    People most frustrated by the level of taxpayer service are our
    taxpayer service employees, the people in the call centers who
    know the level of service they want to provide, they know the
    level of service taxpayers expect, and they are frustrated
    because we can't deliver. We just don't have the resources.
        In the little over 20 months since I started as
    Commissioner, the GAO, the Inspector General, the Taxpayer
    Advocate, and the oversight board all independently have stated
    to Congress that the IRS is under-funded and that, in fact, if
    we continue to have budget cuts, the level of services, the
    level of enforcement, the level of security will do nothing but
    go down.
        Senator Ayotte. Well, I would certainly like a commitment
    as well. I know there have been a number of issues raised,
    including the issue of when in 2014 IRS employees received
    bonuses in which they were rewarded after a report done by
    TIGTA revealed that the IRS had awarded $2.8 million in bonuses
    to more than 2,800 employees that had broken agency rules of
    conduct, including over 1,000 employees who owed back taxes
    themselves. So if we're going to allocate additional resources,
    we need better management also, and I have a list of issues
    like that that I know have been brought up in GAO and TIGTA
    reports, Commissioner.
        Mr. Koskinen. If you would like to send me that list. In
    that case, for instance, we have changed that rule. No longer
    does an employee--they're not bonuses, they're performance
    awards--even if a performance award is earned, no longer will
    it be paid to an employee who has violated an obligation, a
    serious obligation of the IRS, or is not compliant on their
    taxes. We've advised the union about that, and they have
    agreed.
        Senator Ayotte. Well, I appreciate that. I'll send you a
    list. I have a list.
        Mr. Koskinen. I'll be happy to have the list.
        Senator Ayotte. I have a list.
        Mr. Koskinen. Because I agree with you. Taxpayers need to
    know and be comfortable that they're going to get treated
    fairly no matter who they are and no matter what political
    party they belong to. We're spending taxpayer dollars, and
    taxpayers need to be comfortable that we are careful about it,
    that we're frugal, that we're as efficient as we can be. I
    think that's an obligation we have.
        Senator Ayotte. And recognize the immense power that the
    IRS has, and it's important in the sense that people, when
    they're interacting with the IRS, you have a tremendous amount
    of power, and it can be very intimidating.
        I wanted to follow up, on some of the issues that Mr.
    Walker raised as well. He raised an issue of the fact that
    things have changed in terms of how the professional community
    is able to get basic information using electronic databases on
    behalf of their clients. He described, I think, quite a run-
    around of trying to best represent his clients in a way when
    they've been victims of identity theft, but also the story that
    he told about the check, when they were trying to correct the
    record and the run-around that has been given for this poor
    couple.
        So what's happened that the professional community isn't
    able to be part of the solution here and partner to help
    represent their clients as best they can to prevent identity
    theft, number one; and then hopefully if they become victims,
    to correct it?
        Mr. Koskinen. I was concerned about those vignettes because
    our most important partners in tax filing season are, in fact,
    CPAs, enrolled agents, tax attorneys, and preparers generally.
    But certainly enrolled agents and CPAs, we have partnerships
    with them, with the National Enrolled Agents Association. We
    have standing panels. We have advisory committees composed of
    preparers. I know the practitioner priority line, which is a
    line specially set aside for practitioners. Again, because of
    the cuts in personnel, as I said during the last year, it's an
    oxymoron. It's no longer a priority. You have to stay on the
    phone if you're a practitioner almost as long as taxpayers, and
    that's unacceptable because, as noted, the professionals on
    that line are in a position to solve problems and solve them
    quickly.
        This is the first I've heard that they have been declined
    access or can't get access electronically. We are concerned
    with electronic security, and we're dealing with very
    sophisticated, well-funded, organized criminals. A target of
    opportunity for them, besides retail operations, are tax
    preparers. They are increasingly trying to, in fact, steal the
    identity of tax preparers.
        So one of the issues we have is security, but this is the
    first time I've heard that they're having trouble getting in,
    because they shouldn't. We should be able to provide them easy
    access.
        Senator Ayotte. Well, absolutely, because they are part of
    the solution.
        Maybe, Mr. Lee, you've run into this in some of the work
    that you've done as well?
        Mr. Lee. I actually haven't been that involved in the
    practitioner aspect of it, so I don't think I can comment. But
    I agree with the Commissioner that the practitioners need to be
    included since they are----
        Senator Ayotte. I hope from this hearing we can have some
    follow-up to what Mr. Walker is dealing with, to help
    professionals help their clients to solve these problems.
    Obviously, if someone doesn't have the benefit of having
    professional help, we've just got to get this right for a
    person on their own to be able to resolve it more easily.
        Mr. Koskinen. As I've said--and you're exactly right, we
    have the possibility or the likelihood that we are intimidating
    to taxpayers. As our surveys have shown, if you ask taxpayers
    how they'd like to deal with this, the highest priority is not
    to have to deal with us at all.
        Senator Ayotte. Not to have to deal with it. Who wants to
    deal with the IRS, right?
        Mr. Koskinen. Right, we understand that.
        Senator Ayotte. Here you have people trying to correct the
    record with the IRS and----
        Mr. Koskinen. So one of the things we're trying to get
    people to understand and what I was surprised to learn when I
    became the Commissioner is the amount of time and effort we
    spend actually trying to help taxpayers. We have thousands of
    people on the phone, and their only job is to help taxpayers.
        So I have said, and I mean it honestly, if you have an
    issue with the IRS, you're trying to correct an issue, you're
    just trying to figure out how to make a payment or you have
    problems, you've lost a job, you have other challenges, you
    want to create an installment payment, we want to work with
    you. You don't have to call somebody off late-night TV to send
    them your account. If you're trying to become compliant, if
    you're trying to work it through, we want to work with you.
        If you're trying to avoid taxes, if you're trying to cheat,
    then we're happy to be unhappy about that, and those are the
    people who should be intimidated.
        But we're trying to make sure taxpayers understand we
    really take seriously, as you noted in your opening statement,
    our commitment and our mission to provide effective and
    appropriate taxpayer service. So wherever we can improve, we're
    going to try to do it. As I say, with Mr. Walker, I'm going to
    find out. As you noted, we have working panels all around the
    country where we have IRS executives and enrolled agents
    working regularly to deal with problems.
        Senator Ayotte. I think you'd better include him on this
    because he's got some good----
        Mr. Koskinen. He's already on some of them, as he noted.
    But we will find out, because I do think nobody is more
    important to us than professional preparers. As he said,
    they're solution providers. They can get the information. They
    can work with us to help expedite solutions. But even if you
    don't have a preparer, we are very anxious to help make it as
    smooth a process as possible.
        Senator Ayotte. Mr. George.
        Mr. George. Thank you, Senator. Related to what the
    Commissioner just said, the paid preparers are the vanguard
    because of the amount of work and the systems they provide the
    IRS and to the taxpayer. But you have to be honest when you
    think about the complexity of the tax code. One of the tax
    credits that is most abused throughout the tax code is the
    earned income tax credit. The instructions for completing that
    are 30 to 40 pages long, and the average person who takes
    advantage of that normally does not have the wherewithal to
    complete that him or herself.
        But keep in mind, we've estimated, as has the IRS, upwards
    of $20 billion a year is sent out incorrectly under that
    program. Now, a lot of the people who do benefit from that are
    getting some assistance preparing their taxes. I'm not going to
    point to, and we're not in a position to point to any
    particular source, but you need tax preparers, whether they're
    paid or whether they're volunteer, to not be complicit or to
    follow the rules that are required now to confirm that, yes,
    this person does that have dependent and is eligible to apply
    and receive this refundable credit, which means they don't need
    to owe taxes in order to get the money from the Treasury
    through the IRS.
        So complexity is important, or diminishing the complexity
    of completing your taxes.
        Senator Ayotte. Absolutely. And then, of course, for the
    additional child tax credit, you don't have to use the Social
    Security number for the child. We know you've issued reports on
    the billions of dollars that could be saved there, as well.
        Mr. George. We believe, although the IRS has a very
    different interpretation, that the ITIN, the Individual
    Taxpayer Identification Number, is sufficient for that credit.
    We don't agree with that interpretation, but the IRS has a
    different point of view there.
        Senator Ayotte. Well, I have legislation filed on that
    piece, and I think we'll save billions of dollars if we take
    the step that TIGTA has recommended on that.
        I wanted to make sure that we don't leave out two important
    issues. Number one, prevention. I know that we've heard that
    the Get Transcript issue, I believe you testified that the
    number was 350,000 potential impacts to taxpayers of personal
    information from how that was infiltrated. How are we going to
    prevent that in the future?
        And then to Mr. Lee's point, with the added filtering that
    the IRS is putting in. We want to make sure that we're doing
    whatever we can to prevent identity theft. The one-in-three
    false positives for people who are being flagged and then put
    through a rigmarole, how are we going to address those pieces?
    So what more to ensure that something like Get Transcript
    doesn't happen again? And then secondly, so we don't have so
    many false positives?
        Mr. George. I think this is important. That 350,000 figure
    I think is misleading because that doesn't include the
    dependents and others whose information is also contained----
        Senator Ayotte. So it's misleading in a--it's bigger.
        Mr. George. It's a low-ball figure.
        Mr. Koskinen. I wouldn't call it low.
        Senator Ayotte. So those are just the filers versus
    everyone else's information that may be impacted.
        Mr. Koskinen. And we notify everyone on there about the
    issues. The Get Transcript and the false positives, these are
    two related issues. We could make it impossible for a criminal
    to have access to Get Transcript, but at the same time we'd be
    making it impossible for a legitimate taxpayer to have access
    to Get Transcript.
        Even with the system in place, the criminal with all of
    that information still couldn't get through, but 22 percent of
    the taxpayers trying to get hold of transcripts can't get
    through because they can't answer their own questions.
        So as we get better filters, we're going to have higher
    false positives. But the other side of the one-third false
    positive it means that two-thirds of those refunds stopped were
    fraudulent. Had we had lower false positives, we would have had
    fewer stops and more identity theft. When we stop it at the
    door, it's a lot easier to resolve your account.
        Senator Ayotte. Just so we're clear, when we're talking
    about filters, or we're talking about how do we stop up-front,
    we're talking about things like multi-step verification where
    I'm asked what's my mother's maiden name, all those issues.
        Mr. Koskinen. Right. But when you file your return, we want
    to have a set of filters looking for anomalies to determine
    whether that's really your return. This year we stopped 3.2
    million returns that are suspicious. Probably a third of those
    are going to turn out to have been real taxpayers and their
    refund would have been delayed. The other two-thirds, a couple
    of million of them, will turned out to have been fraudulent.
        So the tradeoff, even on the security for Get Transcript,
    is how hard do you make it for a criminal to get through, at
    the same time you're trying not to make it hard for a
    legitimate taxpayer to get through.
        Senator Ayotte. So what do you think we can do more of in
    terms of taking steps to reduce the number of false positives--
    --
        Mr. Koskinen. Well, with Get Transcript, for instance, when
    it happened, my sense was this is a critical issue for us
    because going forward, as Mr. Walker said, our goal is to be
    able to have taxpayers have an account with us electronically,
    digitally, where they can, in fact, access their information.
    Their preparer can access their account. They can make
    corrections directly on their return. They don't have to file a
    paper return. But to do that, the authentication--that the
    right taxpayer is accessing the account--is critical,
    obviously.
        So when we're looking at Get Transcript, we're not looking
    at it as how do we secure that application alone. We're looking
    at it to your question, how do we secure information about
    taxpayers to know that they are the right taxpayer, how do we
    know that the preparer is the right preparer. So we're spending
    a lot of time. I told a lot of people that I would rather put
    Get Transcript back up later, with more confidence that we've
    solved the problem, than rushing to get it up.
        One of the things we're looking at, for instance, is that
    we have to make it go from wholesale to retail. That is, we're
    going to make limitations that if you want to get a transcript,
    only one transcript will be given to an IP address or a
    computer, and probably only one a day. So if you want to go and
    come back and get it again, you can't get it again in an hour.
    You can't get another transcript. You have to come back the
    next day. It's a little less convenient for preparers and
    taxpayers, but it's a security level.
        We're thinking about, and we're investigating whether we
    could have you pay $2 for the transcript using your credit
    card, because the credit card verification would be another
    authentication. In a lot of cases in terms of verification, and
    one of the reasons we have this partnership for the first time
    with the private sector, is a lot of taxpayers have their
    identity verified on their own. A lot of taxpayers allow their
    preparers to take their W-2 information directly from the
    company. If a taxpayer can do that with their preparer, we and
    the preparer have a pretty good idea that that's a legitimate
    taxpayer. If we can pool as many taxpayers as we can in the
    legitimate pool, we'll then have a smaller number that we can
    take a harder look at, and that's what we're hoping to do with
    the state tax authorities as well as the private sector.
        But ultimately the bottom line is, as I say, we're dealing
    with organized criminal syndicates around the world. We will
    never be able to guarantee you that nobody is ever going to get
    through. We'll never be able to stop. We're going to always
    have to be agile and quick and always testing the system and
    trying to keep ahead of, if not up with, the criminals.
        Senator Ayotte. So I want to make sure I get any thoughts
    from Mr. George or Mr. Lee on this. But can I just add my two
    cents to this idea of giving $2 for a transcript on your credit
    card? With everything happening and the number of breaches that
    have happened in the Federal Government with OPM and everything
    else, I think people are going to be quite hesitant to want to
    give their credit card. So I hope we'll look at other ways that
    we can address this. That's just my two cents in hearing it.
        Mr. Koskinen. But that's a good two cents. We wouldn't keep
    the numbers, and it's a great way to verify who you are.
        Senator Ayotte. I think at the moment there are a lot of
    issues even on the other front, not only what's happened with
    the Get Transcript but thinking about the OPM and the massive
    amount of information that we're dealing with on the theft
    there.
        Mr. Koskinen. One thing we should remember, there's a big
    difference between what happened at OPM or Target or JPMorgan
    Chase and Get Transcript. Get Transcript is identity theft.
    Criminals had the information. OPM, Target, and the rest,
    Anthem, are all cyber breaches.
        We're under attack, give or take a little, a million times
    a week. Our system is under attack, over 50 million attacks a
    year on cyber security. So it's a critical issue. It's just a
    different issue than what we're dealing with in identity theft.
        Senator Ayotte. I didn't know if either of you had a
    comment on the prevention piece and where we should be.
        Mr. Lee. I just had a comment on the $2 charge. I mean, I'm
    very comfortable using online services, and I'd be fine with
    that $2 charge. But I believe, as the Senator mentioned, a lot
    of Americans would just be distrusting of the IRS in order to--
    --
        Senator Ayotte. We're giving you a lot of information to
    start with, right? And a lot of dollars.
        Mr. Lee. A lot of taxpayers don't have credit cards.
        Senator Ayotte. That's a good point.
        Mr. Koskinen. We've thought about that, the ones who are
    unbanked or don't have credit cards, and we would be able to
    provide them a transcript. You go online and we mail it to you.
    But most people, when they're trying to get a mortgage or
    trying to get student loans, wait until the last minute, and
    then they need it immediately. But the point is well taken. As
    I say, financial institutions can decide some of their
    customers don't produce enough money and they can leave them
    aside. We don't have that luxury.
        Senator Ayotte. We can't leave anyone aside.
        Mr. Koskinen. We have 150 million taxpayers. Even if only 3
    or 4 percent of them don't like the Internet, don't have access
    to it, never want to use it--my mother-in-law is that way--3 to
    4 percent is 6 million people, and we need to be able to
    provide them appropriate levels of service no matter what else
    we do. So as we go forward in a digital economy, we're not
    going to leave those people behind.
        Senator Ayotte. So I want to make sure--I think prevention,
    anything we can do to, obviously, improve technology, and we're
    headed at least in a direction----
        Mr. Lee. I've got some thoughts on prevention, and this is
    probably outside the scope of what my boss would be comfortable
    for me to testify about.
        Senator Ayotte. That's why--he's not here, right?
        Mr. Lee. Okay. I'd like to just make a comment. We talked
    about moving up the deadline for information reporting so the
    IRS can verify that information. But I think we also need to
    talk about moving back the filing season and the issuance of
    refunds. So instead of taxpayers expecting to get refunds in
    January or February, I think we need to talk about having them
    wait until the summer so the IRS has a chance to look at the
    information that it collects in March.
        Senator Ayotte. This one won't be popular.
        Mr. Lee. It won't be popular, but I think that's something
    we need to have a conversation about, but I don't want to bring
    it to the table. You can foot that idea.
        Senator Ayotte. I think the challenge there is that when
    it's thousands of dollars for some families, that six months
    could be something that they've planned, it could be something
    that's really important to them.
        I had a constituent who their family went through
    difficulties, they were the victims of identity theft, and like
    your office does, trying to work with them to get their refund
    sooner because they thought they were going to lose their
    mortgage because they just happened to go through a bump on
    some other things that were happening and that was so critical,
    and if they had to wait. I think that's one of the challenges
    that identity theft victims are dealing with because for some
    people, depending on what's happening in their lives, it's a
    lot of money and makes a big difference.
        Mr. Lee. Right, it's a big percentage of their annual
    income that----
        Senator Ayotte. That's being held. It's their money.
    Exactly.
        Mr. Koskinen. So again, the tradeoff is that you're trying
    to protect everyone, because if we could have no one be a
    victim of identity theft, that would obviously be terrific. So
    it's, again, a tradeoff. There may be some inconvenience along
    the way to, in fact, try to increase the protection. So before
    Mr. Lee gets dismissed for his idea, people will build their
    lives around when they get their refund. If in one year
    everybody moved from January/February to, say, March or April,
    not June, then they'd count on their refunds in March or April,
    and we've begun to look at it and say what would that do? Would
    that make a significant difference in our ability to protect
    everybody?
        There is no idea that is not under consideration, and
    that's why these partnerships are wonderful, because we're open
    to ideas from other people as well, because there isn't a
    single silver bullet. The partnership, we hope, with preparers
    and state tax agencies will give us coordinated layers that
    criminals have to work through. But it will take everybody's
    best thoughts for us to continue to make progress.
        Senator Ayotte. And I really appreciate all the patience
    and these questions. I want to make sure I follow up on all the
    issues that have been raised. One of them was this issue that
    those who have been victims of identity theft, many of them can
    get the IP PIN number to make sure when they re-file that they
    don't become re-victimized. I heard that there was a big gap, I
    believe 530,000 taxpayers not provided these IP PINs that may
    be eligible for it that may need them. So how is this program
    working? Why aren't some taxpayers being given access to it?
        One couple asked me on the way in here today if they've
    been a victim of identity theft and they file the next year
    with the IP PIN program, is this something they're going to be
    continuing and able to do?
        Mr. Koskinen. Yes.
        Senator Ayotte. So it's not one year but they have that
    protection if they want to have it going forward.
        Mr. Koskinen. Yes. A lot of good questions in there. The IG
    has been very helpful to us over the years in reviewing and
    giving us suggestions, and we've adopted most of those,
    implemented most of their suggestions in this entire area.
        On the issue of IP PINs, the issue really was not so much
    people who had actually been victims but people whose records
    had been flagged.
        Senator Ayotte. So it would be victims or potential
    victims.
        Mr. Koskinen. People where there was suspicious activity in
    their account. There were 1,700,000 of those. So this year for
    the first time, we took that recommendation and sent out 1.5
    million IP PINs to known victims. We offered another 1.7
    million Americans IP PINs where their accounts had been
    flagged. They hadn't necessarily been victims but it was clear
    there was an issue.
        Similarly with Get Transcript, we offered everyone where
    there was any access to their transcript an IP PIN. Now, your
    point about it, we're considering right now that once you have
    an IP PIN, it's yours and you should actually use it every
    year, and each year we send you a new one. We're now looking
    at, well, could we give them to you for three years so every
    year you don't have to worry about if I move, does my IP PIN
    follow. But if you've signed up for it, or you have to use the
    IP PIN, and it goes for a while.
        The other thing we're looking at is after a number of
    years, and we know because we track, that even after we've
    stopped a return, the next year the fraudsters come back in a
    reasonable percentage of cases. So the IP PIN protection is
    very important.
        Senator Ayotte. Right, because once you've been victimized
    once--I have to say, my uncle was a victim of tax-related fraud
    too, and he wasn't just victimized once. It was twice.
        Mr. Koskinen. Yes, because what happens is--and especially
    when we've stopped them, you'd think, well, why would they file
    again? But it's not as if there's a single person out there.
    This data is out there and available to people, and it's being
    sold.
        Senator Ayotte. Yes, it's a criminal network using your
    data because it's out in this----
        Mr. Koskinen. So it may be a new network that buys a whole
    pool of Social Security numbers from other crooks, and they
    don't know--nobody is telling them this is a good Social
    Security number. They're just selling them--here's a thousand.
    So the IP PIN--we encourage people to use it.
        We have a pilot program we've run for two years in Florida,
    Georgia, and the District of Columbia, which are the hotbeds of
    SIRF, offering everyone in those states the opportunity to----
        Senator Ayotte. I'm starting to feel New Hampshire is a
    hotbed, unfortunately.
        Mr. Koskinen. You ought to go to Florida.
        So we're running pilots. The reason we're running these
    pilots is to see what the uptake is, what the cost is, what the
    burden is, because it is a way, in effect, of changing your
    identifier from your Social Security number to a number that
    only you and we have.
        Senator Ayotte. Right. And I know Mr. George wanted to jump
    in.
        Mr. George. Just to make this point about something
    perverse with all of this. And that is, again, if you don't
    have a filing obligation, and if the bad guy does assume your
    identity, believe it or not, the IRS communicates with the bad
    guy using the address the bad guy provides. So the senior
    citizen or somebody who otherwise doesn't have a filing
    obligation is just completely unaware that all of this is
    happening. And I don't fault the IRS necessarily here, but they
    have a very difficult job, Senator. As the Commissioner pointed
    out, they have to keep up with these very smart, overseas many
    of them, bad guys who are constantly thinking of new ways to
    manipulate the system, and it's a very difficult task.
        Senator Ayotte. This issue of the pilot, you notified
    25,000 taxpayers when you learned that their Social Security
    number may have been misused. Is this something that you plan
    to implement with everyone? That's been a piece of our
    legislation, that if the IRS knows that your Social Security
    number may have been misused. Often I'm hearing from taxpayers
    that they're finding it out when something happens to trigger
    it, whether they're filing their tax return or some other
    action. Maybe it's a credit issue or something. It's pretty
    valuable information, I think, for people to know as soon as
    possible to protect themselves.
        So what's your thought on that?
        Mr. Koskinen. As I say, this year, for anybody whose
    account has been flagged but is not necessarily a victim of
    identity theft, that 1.7 million we've written to and said that
    there's an indication of fraud, you can get an IP PIN if you
    would like one.
        Similarly, the purpose of this pilot is to, in fact, see
    what the burden is, what the take-up rate is, because as a
    general matter the risk for a taxpayer is not--I mean, it's a
    risk and an aggravation when you're an identity theft fraud
    victim, but they're not getting any more information from us
    about you. The risk is that they already have that information.
    So what we're trying to figure out is how do we let you know
    that even if you're not a victim of identity theft, you need to
    know that information is out there and being used by criminals.
    If you're not a victim of identity fraud, and even if you are,
    it doesn't affect your relationship. We'll work it out. The
    risk is it's being used also for other issues.
        Senator Ayotte. Oh, it puts people at risk. So I would hope
    that----
        Mr. Koskinen. Our goal is to do whatever we can, and the
    pilot will do that, to try to help people, even though it won't
    be in relation to us. But we just feel it's important for them
    to know that we have an indication that your data is out there
    being used by criminals.
        Mr. Lee. My understanding is that this recommendation was
    raised at the executive steering committee level this summer,
    so we're hopeful that the IRS will expand the program for all
    taxpayers, not just the 25,000.
        Senator Ayotte. Good. I hope so, too. And if not, we have
    legislation that would make sure that--we want people to know
    so that they can protect themselves.
        You've had the opportunity to hear from Ms. Weeks and also
    Mr. Walker, and I can assure you that they're representative of
    many people who are in this room and what they've gone through,
    but many people who can't be here today with this issue. It is
    my hope that the issue of getting the fraudulent return so the
    taxpayer can understand what's been used, that that will be
    resolved as soon as possible. You gave me a date of October,
    and we'll be following up on that.
        Mr. Koskinen. We'll be talking.
        Senator Ayotte. We'll be talking on that. I heard,
    Commissioner, that you want to get to an issue where the
    taxpayer is not getting the run-around and having to deal with
    multiple people if they're a victim of identity theft, and this
    seems to me a critical issue that we've got to do much better
    on so that people aren't getting re-victimized after they've
    gone through having their personal information stolen.
        And finally, I hope that any time the IRS knows that
    someone's information is being misused, that they will notify
    them and that will be something that is adopted for all
    taxpayers.
        There are a number of other issues that were raised here,
    and I think Mr. Walker has an invitation there to allow the
    professional community to help solve this problem too, to allow
    them to have access to the taxpayer information for their
    clients in appropriate ways to be able to solve this.
        So there were a number of issues that were raised today.
        I want to thank all of you for being here. I especially
    want to thank again Ms. Weeks and Mr. Walker. I plan to
    continue, obviously, working on this issue. I feel quite
    passionate about it, and we can do a lot better for taxpayers
    on every front, on prevention, and also how they are treated
    if, unfortunately, they become a victim of identity theft. This
    is a very critical issue.
        As you pointed out, Commissioner, we are facing a number of
    cyber-attacks that make this continue to be criminal networks
    who are misusing people's information, and I think we need to
    do everything we can on the law enforcement end to go after
    them as well.
        So with that, I'm going to conclude this hearing. I may
    leave the record open for some additional written follow-up
    questions, and I appreciate your traveling to New Hampshire
    today for this hearing.
        Before we end, I just want to very much thank the Budget
    Committee staff who have come here, Adam Kamp and Katie Smith
    and my own staff member, Marne Marotta. I would also say if my
    staff who are here, Anne Warburton and Jane Hirsch, they work
    on these cases on behalf of my constituents, and anyone who
    would like some help from our office, I do have my
    representatives here today and we would very much like to help
    you if you are a victim of identity theft to try, to cut
    through some of the rigmarole that we've talked about today.
        So, thank you all.
        [Whereupon, at 4:30 p.m., the hearing was adjourned.]
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                                     [all]