Everyone deserves a second chance. But that can be a tall order for ex-offenders, many of whom live in the lowest-income communities and face immense hurdles getting jobs and housing. Now, according to a government report, they are frequently the victims of identity fraud as well. A Wall Street Journal article highlights the work of LISC's Financial Opportunity Centers in helping ex-offenders—who make up 30% of FOC clients—repair their credit scores, find jobs, gain financial stability and become part of their communities again.
The below excerpt is sourced from:
"Identity Theft, Tax Fraud Snares Prisoners"
by Joe Palazzo, The Wall Street Journal
Identity Theft, Tax Fraud Snares Prisoners
A raft of federal prosecutions has uncovered tax-fraud schemes involving the theft of U.S. prisoners’ social-security numbers, many times stolen by corrections employees.
Last year alone, federal courts meted out prison sentences to an Alabama bail bondsman, two former Alabama corrections employees, a Florida corrections officer, and a Georgia man, who were convicted separately of stealing the identities of more than 1,200 prisoners and claiming more than $6.5 million in tax refunds under the inmates’ names.
In January, a Kentucky judge sentenced a local corrections officer to three years in prison for filching prisoner information to open up credit-card accounts with Capital One, Barclays Bank and Victoria’s Secret.
Scores of prisoners have also been prosecuted in recent years for preparing false tax returns from behind bars, using their own and other inmates’ social security numbers.
A report by the Treasury Inspector General for Tax Administration, released last year, found that false returns filed with prisoners’ social-security numbers had surged to about 137,000 in 2012 from 37,000 five years earlier. Refunds claimed in the false returns in 2012 amounted to about $1 billion; the Internal Revenue Service prevented all but about $70 million from leaving the Treasury, the report said.
[. . .]
Identity theft can make it even harder for ex-convicts, who already face hurdles getting a job or housing, to support themselves as they try to re-enter society, social workers say.
The Local Initiatives Support Corp., which provided nearly 7,000 ex-offenders around the country with financial coaching and job training in 2014, found that more than 20% of prisoners had inconsistencies on their credit reports, a large portion of which were linked to identity theft, a spokeswoman said. Continued[+]...