Criminal activity is discovered in a variety of ways, including tips, internal audits, by account reconciliation, or by document examination.

FORBES: A Snitch In Time Can Save Employers a Lot of Money

The Foreign Account Tax Compliance Act, requires foreign financial institutions to start reporting detailed information about U.S. account holders to the Internal Revenue Service in coming years.

WSJ: Foreign Deal on Tax Dodging

The Internal Revenue Code exempts payments received on account of personal physical injuries and physical sickness.

FORBES: Tax On Wrongful Imprisonment Needs Reform