Colin McDonald wants a tax count weighed in every single case his prosecutors pursue — fraudsters’ gains are income, and failing to report them is another crime. He wants it at an agency the administration he serves has spent a year hollowing out. That is not enforcement policy. That is a press release with the staffing page torn off. Even taken at face value, the arithmetic doesn’t staff a charge-everything mandate: the administration has proposed cutting the IRS budget by $1.4 billion in 2027, what it calls unwinding a 20,000-person Biden-era buildup. The fraud crusade is a hiring plan for lawyers who will never have anyone to do the investigating.
This is the same fraud division that has been picking fights with the white-collar lawyers it needs while propping up its own record with old cases — its pick for the job having sat under scrutiny for oversight problems — now announcing a surge in tax charges that nobody left at the IRS Criminal Investigation unit has the hours to build. That unit lost 331 people last year, 101 of them special agents, and between May 2025 and March 2026 it handed over labor valued at $37 million — the equivalent of 170 full-time agents — to immigration and street-crime operations. The accountants with guns are driving buses. Today’s agents are directing traffic at immigration checkpoints.
A tax case is not a memo. It is forensic accounting, surveillance, financial analysis, months of agent time per count. Carolyn Schenck, who spent nearly twenty years inside the IRS, put it as gently as the profession allows: criminal tax cases are resource-intensive, and it is going to be tough. Sean O’Connell, who has prosecuted both kinds, read the memo and told you what it really says — tax cases are to “tag along” on somebody else’s fraud file. They are being polite. What is actually being asked is the Capone play without the ledger readers who made the Capone play work. Capone went down because agents were actually in the room.
Follow the money and you find none. A 2024 GAO report puts annual fraud losses at as much as $521 billion; the same agency more recently estimates uncollected tax at up to $304 billion a year — the real pot of money. Last year the department watched its veterans walk out — David Hubbert, Stuart Goldberg, decades each — and then dissolved its ninety-year-old tax division outright. So the pitch is: add a charge type to every case, with a depleted agency, no dedicated division, and the experienced hands gone. The government named a fraud czar to chase that half-trillion-dollar problem, then handed him an empty chair and a slogan. The answer to both GAO numbers is a directive and a slideshow: dozens of cases, $490 million in accusations, no new investigators assigned to go dig for any of it.
This is the machine, and I have watched it since Nixon: announce you are tough on the crime, defund the people who catch it, then measure success by the announcements. It is not enforcement. It is a bumper sticker stapled to an empty file drawer. Somebody will read the surge announcement as proof the administration is tough on fraud — the same record-setting theater it staged last month — and count on the courts to do arithmetic the IRS no longer has the staff to do.
Tough. Yes. For everyone except the administration that cut the budget and then demanded the results. Again.