MI: Tax preparer leaves clients’ tax records behind in foreclosed home, but so did Treasury agents sent in to clean it out

Okay, this is bad.

Ken Kolker reports:

Federal agents raided a tax preparer’s former home and seized abandoned documents from decades of returns, including names, addresses and Social Security numbers — but they didn’t get it all, Target 8 discovered on Wednesday.

Target 8 found thousands of pages of tax documents in a burn barrel behind the empty home. Unburned, they showed enough information for thieves to easily steal taxpayers’ identities.

Other records were scattered on the ground, including a W2 from a man from the City of Wyoming; tax documents that showed another man earned $90,400; a pay stub for a man named Daniel.

Federal officials told Target 8 they planned to return to the home to seize the left-behind documents.

It started about three weeks ago when long-time tax preparer Karol Fitzgerald lost her home to foreclosure and moved out. She ran her tax business from the home. She left behind records from several decades as a tax preparer.

[…]

Fitzgerald, 69, said she didn’t know the feds had raided her former home. She said she thought her son had burned the tax records in burn barrels out back.

Read more on Wood8. For what it’s worth, I wouldn’t describe this as a “raid” as much as the IRS responsibly coming in to clean up the mess the tax preparer left behind. Yes, it was appropriate to get a warrant as it was not their property and they’re the government, but “raid” connotes something else to me. Sadly, they do not seem to have done a totally thorough job in reclaiming/securing the records, as some were still left behind until the news station investigated and contacted them.

Under Michigan law, do all the clients have to be notified if the records were n paper format? I think Michigan law should cover paper format, although the statute does refer to data being part of a “database.” And if notification is required for paper records, who’s going to notify all those clients that their records were exposed? Ms. Fitzgerald no longer has the records. So would/will the feds provide notification to individuals?

And do we know if any – or how many – records may have been stolen while the home was left unsecured?

What a mess.

I seem to recall another case in Michigan where the state sued someone for abandoning and burning records, but I’m not sure the facts of the cases are similar enough as those were medical records and the improper disposal violated public health code. In this case, I’m not sure what, if any, law was violated, other perhaps, than burning the records on property not licensed for waste disposal. It will be interesting to see if Ms. Fitzgerald is ever charged with anything.

About the author: Dissent