County Finds Homestead Exemption Fraud and Discovers $1.5 Million in New Revenue

22244721 - money, dollars.

Have you ever found a $5 bill in your wallet or a pair of jeans? If so, you know how great it feels to suddenly find money that you didn’t even realize that you had, especially when you’re strapped for cash. So, imagine what it is like for a county, in these tough economic times, to find over a million in new revenue simply by identifying money that is owed by taxpayers committing homestead exemption fraud; that’s the case in today’s ”Fraud of the Day” from

The article reports that Delaware County, Indiana leveraged ”a fraud solution that combines analytics technology and investigative research” to ”uncover $1.5 million in lost property tax revenue.’? The solution, called the Homestead Exemption Fraud Detection program, was managed by two vendors and ”pinpointed homeowners in the county who shouldn’t have claimed a homestead exemption benefit on their property taxes.’? One vendor reviewed a batch of property owner data and compared it against public records databases using data analytics technology and identified key indicators for fraud. The other vendor then worked with the county auditor’s office to investigate the findings and prioritize accounts to pursue for collection.

Indiana has gone back and reviewed records for the past three years and has assessed a 10 percent penalty on the total owed. (Let’s get those back taxes and rehire some teachers and police!? The number of fraudulent properties identified is ”close to 1,000” and billing notices have already been sent for nearly $264,000. The article pointed out that leveraging the vendors involved made sense: ”the county didn’t have the technology or capability to do in-depth fraud research, so making the investment to have access to a national database for more data was a no-brainer.”

By detecting homestead exemption fraud, Delaware County has added new revenue to its coffers for this year and years to come. But is a Homestead Exemption Fraud Detection program worth it? Delaware County’s clerk of corrections seemed to think so, noting? ”’It’s well worth it. This is money we didn’t have to begin with.”? (Got to love people that just get it done!)

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”County uses fraud solution to unearth $1.5 million,” written by Brian Heaton and published by on March 8, 2012.

A fraud solution that combines analytics technology and investigative research has helped Delaware County, Ind., uncover $1.5 million in lost property tax revenue.

Developed by LexisNexis and Tax Management Associates Inc. (TMA), the program pinpointed homeowners in the county who shouldn’t have claimed a homestead exemption benefit on their property taxes. Background data on the individuals in question was gathered by LexisNexis and reviewed by the county auditor’s office. A bill was then issued for the unpaid taxes along with a 10 percent penalty on the amount.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.