Mark Matthews Speaks to Tax Notes on IRS Rotating Fraud Technical Advisers

The conversion of the fraud technical adviser role into a rotating position as part of the October overhaul of the IRS’s National Fraud Program could produce several benefits if the IRS carefully monitors the program.

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Sound Reasons

Mark E. Matthews of Caplin & Drysdale, Chtd. said that there are sound reasons for any enforcement bureaucracy to rotate its employees through a variety of experiences. While the effects of the changes should be tracked going forward, it is a promising idea, he said.

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Force Multiplier

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Matthews, who was IRS Criminal Investigation division chief during the development and creation of the fraud technical adviser position, said that making the fraud technical adviser a rotating-type position will, over time, increase the number of people within the IRS who have experience evaluating fraud cases.

“Compare 50 people who are doing it toward the end of their careers and for the rest of their careers versus a rotating position where you might have 200 people who have been in that job at any given time,” he said. “I would think of that as a force multiplier if it works well.”

The three-to-five-year rotation sounds like the right amount of time for people to gain enough experience and do valuable work as fraud technical advisers, while allowing the IRS to get regular fresh faces in the position, Matthews said.

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Keep a Lookout

Matthews said the IRS should monitor the National Fraud Program after the changes to be able to compare the resulting fraud referrals under the old model with those under the new model. “You will want some metrics around this eventually,” he said.

The IRS also needs to monitor the fraud technical advisers to be sure that they do not step over the line between civil and criminal investigative functions as required by United States v. Tweel, 550 F.2d 297 (5th Cir. 1977), Matthews said. The IRS needs to keep the rotating advisers reined in lest they see themselves as junior CI investigators and lull taxpayers into thinking a case is still civil after there has been an institutional decision to refer it for criminal investigation, he said.

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Excerpt taken from the article “Rotating Fraud Technical Advisers Seen as Promising Idea” by Nathan J. Richman for Tax Notes.