The IRS failed to do background checks on some private contractors who handled confidential taxpayer information, exposing more than a million taxpayers to an increased risk of fraud and identity theft, a government investigator said Thursday. In one case, to transport sensitive documents the IRS used a courier who previously had spent 21 years in prison on arson and other charges.
“Allowing contractor employees access to taxpayer data without appropriate background investigations exposes taxpayers to increased risk of fraud and identity theft,” the inspector general, J. Russell George, said.
IRS policy requires contractors with access to confidential taxpayer information to undergo background checks, though the policy wasn’t always followed, the report said. About 10,000 private contractors have access to such information.