The House Ways and Means Oversight Subcommittee has contacted the IRS looking for answers regarding the streamlined process for applications for tax-exempt status, which allowed one fraudster to have 76 fraudulent charities approved. The fake nonprofits all had names that sounded similar to legitimate nonprofits, such as “American Cancer Society of Michigan.” The actual American Cancer Society had even gotten wind of its fraudulent namesake and contacted the IRS. The IRS is now under fire for not noticing that this particular group of fraudulent charities all used the same Staten Island address. It also highlights the IRS’s own statistics that only one in 2,400 of these streamlined applications gets denied. (www.wealthmanagement.com/philanthropy/irs-hot-water-over-fraudulent-charities)
CPAs, get four hours of fraud CPE with our Fraud Essentials for CPAs Webinar. Click here for more information.