Tuesday, January 19, 2010

NY uses data mining to catch tax cheats

And collect a mountain of data about every aspect of the private lives of New Yorkers.

Syracuse, NY -- Another crazy idea popped into Bill Comiskey’s head: What if the tax department required banks to turn over their customers’ mortgage applications?
Homebuyers fill them out at a time when they want to impress the bank with their incomes. They sometimes are not in the same mood when they fill out their tax returns. Investigators could compare the two records, look for clues.

Comiskey, the state’s lead tax enforcer, called Nonie Manion, director of the audit division, from the car. He was zipping across New York state to deliver another speech at another tax preparers convention.

“Would this work?” he asked.

Every piece of personal information is on the table these days at the tax department, where a desire to collect taxes on the underground economy is prompting new and aggressive tactics. Comiskey, a one-time Mafia prosecutor, has been armed by lawmakers with new powers. His staff is for the first time pulling information from third parties into a continuous river of information about businesses and individuals.