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IRS accused of ending methods that found fraud

Treasury Department investigators say the Internal Revenue Service is looking the other way instead of rooting out fraud when people apply for taxpayer identification numbers.

The ID numbers are used instead of a Social Security number by non-citizens who have to file tax returns. Almost 3 million returns were filed under the program last year.

The Treasury Department's inspector general for tax administration says instead of worrying about fraud, IRS managers focused on how many applications they could process and did away with fraud-detection measures that had been working.

All applications for ID numbers are processed at an IRS center in Austin, Texas.

IRS officials responding to the report say they've taken steps to rectify the problem and are reviewing other possible changes. 

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