IRS Allegedly Using AI to Spy on Citizens’ Bank Accounts

WASHINGTON, D.C. – Today, Chairman Jim Jordan (R-OH) and Rep. Harriet Hageman (R-WY) sent a letter to Treasury Secretary Janet Yellen and Attorney General Merrick Garland opening an inquiry into the Internal Revenue Service's (IRS) use of artificial intelligence (AI) to surveil Americans' financial information. The Committee and its Select Subcommittee have reason to believe that the IRS and Department of Justice (DOJ) are actively monitoring millions of Americans' private transactions, bank accounts, and related financial information—without any legal process—using an AI-powered system. This AI-powered warrantless financial surveillance is highly concerning and raises serious doubts about the federal government's respect for Americans' fundamental civil liberties.

The letter also requests Alex Mena, an IRS official working in the agency's Criminal Investigations Unit who admitted that the IRS has "a new system" that uses AI to target Americans, appear before the Committee for a transcribed interview.

Read excerpts of the letter to Treasury Secretary Yellen:

"The Committee on the Judiciary and the Select Subcommittee on the Weaponization of the Federal Government are conducting oversight of the federal government’s use of artificial intelligence (AI) technology to surveil American citizens' financial information. Based on recent reporting and other information obtained by the Committee and Select Subcommittee, we believe that the Department of the Treasury possesses information necessary for our oversight and we request your full cooperation.

"In September 2023, the Internal Revenue Service (IRS) announced that it was using AI to 'help IRS compliance teams better detect tax cheating, identify emerging compliance threats and improve case selection tools.' According to the announcement, 'the IRS is deploying new resources towards cutting-edge technology to improve our visibility on where the wealthy shield their income and focus staff attention on the areas of greatest abuse,' including 'cutting-edge machine learning technology.' On February 28, 2024, the Treasury Department publicly acknowledged that it has 'implemented an enhanced process using AI to mitigate check fraud in near real-time by strengthening and expediting processes to recover potentially fraudulent payments from financial institutions' since late 2022. As noted in a Treasury Department press release, '[t]he enhanced AI process and OPI’s [Office of Payment Integrity] strong partnership with federal law enforcement agencies have led to multiple active cases and arrests with law enforcement' and the recovery of $375 million in Fiscal Year (FY) 2023 alone.

"However, recent reporting alleges that the IRS's use of AI has also included actively monitoring American citizens' bank accounts en masse and without legal process. Video footage obtained by an investigative media outlet appears to capture Alex Mena, an IRS official working in the agency’s Criminal Investigations Unit, admitting that the IRS has 'a new system' that uses AI to target 'potential abusers' by examining all returns, bank statements, and related financial information for 'potential for fraud.' Mena asserted that the new AI system has the ability to access and monitor 'all the information from all the companies in the world.' In the video, Mena suggested that the AI-powered system can 'see the amount' in every American's bank account, adding that this 'invasive' system is 'working really well' 'nationwide.' Mena also noted that IRS agents 'have no problem, like, going after the small people, you know, putting people in prison. Like destroying people's lives, they have no problem doing that.' When asked whether the system is constitutional, Mena replied, 'I doubt it.'

"The Committee and Select Subcommittee have reason to believe that the IRS is working with other federal agencies to conduct this AI-powered warrantless financial surveillance. In the video, Mena stated that the Department of Justice (DOJ) and 'Inspector General' control this AI-powered warrantless surveillance system, 'not the IRS.' Additionally, the Treasury Department's February 28, 2024 press release makes clear that the Treasury Department's Office of Payment Integrity (OPI) has a 'strong partnership with federal law enforcement agencies,' which has 'led to multiple active cases and arrests.' These allegations are particularly concerning given the IRS's track record of targeting, harassing, and intimidating American taxpayers and journalists and history of ignoring due process requirements when investigating taxpayers.

"Congress has an important interest in protecting Americans' privacy, and the Committee and Select Subcommittee have been conducting oversight of the Executive Branch's financial surveillance of American citizens. The use of AI technology to actively monitor millions of Americans' private transactions, bank accounts, and related financial information—without any legal process—is highly concerning. This kind of pervasive financial surveillance, carried out in coordination with federal law enforcement, into Americans' private financial records raises serious doubts about the IRS's—and the federal government's—respect for Americans' fundamental civil liberties.

"Thus, in furtherance of the Committee’s oversight efforts, we ask that you please provide the following documents and information for the period January 1, 2021, to the present:

1. All documents and communications referring or relating to the use of artificial intelligence, including machine learning and large language models, to track, monitor, surveil, investigate, audit, or otherwise view the financial information of American citizens, including:

a. All documents and communications between the Treasury Department and any other federal agency; and

b. All documents and communications between the Treasury Department and any bank or financial institution.

2. All documents and communications referring or relating to the control of any artificial intelligence system described in Request 1."

Read the full letter to Secretary Yellen here.

Read the full letter to Attorney General Merrick Garland here.

This article originally appeared as a press release from the House of Representatives Judiciary Committee