Nightly News   |  September 02, 2011

49 in Florida charged in IRS tax scam

Police and federal agents in Tampa, Fla. have broken up what they say is a massive fraud scheme to get money from the federal government. The crooks’ target was the Internal Revenue Service. NBC’s Pete Williams reports.

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>>> police and federal agents in tampa , florida have broken up what they say is a massive fraud scheme to get money from the federal government . the target, the irs , and you will be stunned at how easy it was for the crooks to get their loot. nbc news justice correspondent pete williams has the report.

>> reporter: police in tampa , florida are accustomed to seeing drug dealers with nanunanimou fancy cars but they were stunned to find out where this bechbtly came from. they have arrested 49 people charged with fraud and identity theft , accused of receiving piles of cash by filing phony tax returns to get money in the irs .

>> the money was raining down on these suspects, it was easy money and free money .

>> reporter: officials say identities were stolen from family tree websites, the scammers then used tax filing software to apply for refunds with the stolen names. money poured back from the irs sent on ready to use debit cards . police watched suspects spend up to $20,000 at a time on shopping sprees for jewelry and clothes. sal mageri said the scam was highly addictive, sweeping the streets like a drug ademocratic. postal inspectors said they received irs refund cards worth $130 million all destined for tampa .

>> people are going to learn quickly that this is an easy way to make money and basically pick the pocket of the u.s. government . among the victims, logan, a developmentally disabled man whose parents say his identity was stolen to get $2,600 from the irs .

>> you feel personally violated that somebody would stoop to this, to try to gain money out of the system.

>> reporter: the irs says it has a system for detecting scams like this, but government auditors say it's often unable to spot them until the money has already been paid. police in tampa say they're cracking down hard, still puzzled about how they became the capital of tax refund fraud. pete williams , nbc news, washington.