The term "tsunami" has unavoidably thrust itself onto the world scene in recent years. The Indian Ocean tsunami in December 2004 left more than 150,000 dead or missing with incomprehensible speed. And less than two years ago, in March 2011, a tsunami claimed 16,000 lives in Japan and crippled a nuclear reactor.
Literally, the term tsunami refers to a huge ocean wave caused by an earthquake or volcanic eruption that occurs underwater. Figuratively, however, it refers broadly to an activity that is out of control and threatens widespread damage.
Such waves are occurring, the U.S. attorney for South Florida has said, with tax fraud based on identity theft that seeks false tax refunds. It's a story we've been following closely in this blog. Two week ago, we devoted a two-part post to the problem and the IRS's response.
The U.S. attorney, Wilfredo Ferrer, says that identity theft schemes are "a national trend that is causing a hemorrhage of tax dollars. With so many of these schemes in operation, the effect, he believes, is "a tsunami of tax fraud."
The problem is indeed national in scope. The IRS says cases of tax fraud based on identity theft in 48 states. But Mr. Ferrer says that the epicenter of the problem is in Florida, particularly in Miami and Florida. This is reflected, he says, in data showing the per capita rate of false tax return claims is 46 times higher in Miami than it is elsewhere in the U.S.
Reasonable minds could differ on whether the high rate of fraud amounts to a "tsunami." It's true, though that the number of reported cases has increased dramatically. It has gone from fewer than 50,000 in 2008 to more than 1.2 million last year.
Source: "'Tsunami' Of Tax Fraud Hits Miami, State of Florida," HuffPost Miami / Reuters, 2-17-13