The State of Georgia for the Win


It’s the same feeling, I’d imagine, that an impossibly small country feels when its curler or alpine skier wins the Olympics. The odds? Impossible. The glory? Eternal. It may seem like an exaggeration, but in the fight against fraud the victories are few and far between. Last year, the Georgia Department of Revenue kept $71 million from being pocketed by fraudsters, as reported by The Atlanta Journal-Constitution. Thanks to the LexisNexis Tax Refund Investigative Solution, the Department is anticipating that an additional $20 million will be saved this year. (Go team!)

Here’s how it works: the system compares tax refund requests with multiple identity records compiled from various public records. In short, the new system takes all the information that can be found on an individual and assembles it into one place.

So, what’s the difference between the existing system and the new system? The existing system is rules-based, meaning the Department of Revenue created and designed a system to find certain anomalies. If, for example, someone files a return one year and owes money and then files the following year requesting a multi-million refund, this may raise a red flag and cause the agency to question the authenticity of the return. This system, by the way, works really well – it found $71 million last year. The new system includes an identity-based filter. Its purpose is to find identity-based fraud by double-checking the identity of those claiming refunds to make certain they are who they say they are.

The system implements a personalized quiz that often surprises potential fraudsters. When you’re being asked questions about the acreage on your first property or your second wife’s middle name, you think twice before you try and finagle an answer.

Haywood Talcove, CEO of LexisNexis Special Services Inc. noted the impact the personalized quizzes have had on fraudsters saying: ”Fraudsters will dial in, but not even say anything. They’re scared to death now. They’ll say, ‘I’m a fraudster; I don’t want to impact my enterprise.”’ (Not saying that I condone scaring fraudsters…okay, maybe I do.) Almost 100,000 fraudulent tax returns were filed last year in the state of Georgia alone. Okay…today’s commentary may have turned into a bit of a shameless plug, but let’s all take a moment and recognize that the state of Georgia should get a serious pat on the back for outsmarting the fraudsters.

Source: Today’s ”Fraud of the Day” is based on the article entitled, ”Georgia Escalates Fight Against Tax Fraud,” written by Paige Cornwell and published by The Atlanta Journal-Constitution on June 11, 2012.

In 2011, the Georgia Department of Revenue detected more than 100,000 fraudulent tax return requests, stopping $71 million from being sent to fraudsters.

This year, the state is escalating the fight. Department officials anticipate an additional $20 million will be saved, due to a new system launched in January that puts a finer screen to potentially fraudulent requests.


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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.