Refund Fraud scamsters Identified----IT DEPT

Refund Fraud scamsters Identified. Swift action by the Income tax Department to put in place a robust method of issuing refunds



No.402/92/2006-MC (05 of 2010)



Government of India / Ministry of Finance



Department of Revenue



Central Board of Direct Taxes



New Delhi dated 25th January 2010





DRAFT PRESS RELEASE



On or about 12th January 2010, an officer in the Income Tax



department, Mumbai, noticed that refunds had been issued from his



jurisdiction without his knowledge or approval of his higher authorities. He



immediately brought the matter to the notice of his superior officers.





2. On internal inquiry by the Income Tax department, it was found that



User Ids and Passwords of certain officers had been fraudulently used to



generate refunds in some cases. Upon detection of the fraud, the following



actions were taken by the Income Tax department to contain the damage:-





(i) Stop payment orders were issued. As a result, refund outgo in at least



two cases could be prevented.



(ii) Investigation and search action was undertaken by the Directorate of



Income Tax (Investigation), Mumbai to detect the bank accounts to



which the refunds had been credited and the beneficiaries.





(iii) I-T investigators have identified the bank accounts, beneficiaries and



some of the scamsters involved.





(iv) Mumbai police and CBI Mumbai have been informed.







3. Further actions being taken to prevent the recurrence of such frauds



are as follows:-







a) All high value refunds issued during the current financial year will



be cross-verified.







b) The system of handling high value refunds will be replaced with a



more robust and foolproof system.





SOURCE;CGSN