Crackdown on Snooping Into Tax Files Told : Privacy: Senator says more than 1,300 IRS employees were targeted. Offenses ranged from nosiness to bogus refunds.

More than 1,300 employees of the Internal Revenue Service have been investigated or disciplined since 1989 for using government computers to browse through the tax returns of friends, relatives and neighbors, Sen. John Glenn (D-Ohio) said Monday.

Glenn, chairman of the Senate Governmental Affairs Committee, said that of the 1,300 IRS employees investigated nationwide, more than 500 cases occurred in the last 10 months.

The nationwide figures on IRS employee snooping into tax files were compiled after Glenn disclosed in August, 1993, that almost 370 employees in the agency’s Southeast region had improperly examined taxpayer accounts.

The disclosure brought expressions of outrage from several senators and of concern from tax specialists, who said they were surprised that so many workers could be accused of abusing their positions.

“How much of this was prelude to fraud and how much was just prurient window peeping is difficult to say,” Glenn said in a statement. Calling the nationwide figures disturbing, he said the IRS has a moral and legal obligation to protect the confidentiality of taxpayer records.

Glenn said more than 420 of the IRS cases have resulted in some type of disciplinary action and that several hundred cases are still under investigation.

In remarks prepared for delivery to Glenn’s committee today, IRS Commissioner Margaret M. Richardson said the agency now has a better system for detecting unauthorized use of its computers and a strong penalty guide. She said future data systems will be less vulnerable to such abuses.

Richardson’s testimony points out that fewer than 1% of IRS computer users have been found to have misused their access to accounts.

The commissioner also said she has appointed an IRS “privacy advocate,” Robert Veeder, to oversee efforts to safeguard taxpayer records.

Glenn’s committee was to discuss the new data on IRS snooping at a hearing scheduled for today. It will also look at the potential for fraud involving taxpayers who file for inflated or phony refunds.

Glenn learned about IRS employee snooping after the General Accounting Office reported that the IRS “did not adequately control access authority given to computer support personnel or adequately monitor employee accesses to taxpayer data.”

IRS documents Glenn released last year showed that the agency had been investigating regional employees for about three years. A few of the cases involved workers who looked up the accounts of celebrities. At least one employee was reported to have altered about 200 accounts and received kickbacks from bogus refunds.