Tax dependent fraud is one of the largest abuses of the system. The IRS keeps an eye out for those who are abusing the system by claiming dependents who aren't theirs to legally claim. A large reason for claiming fraudulent dependents comes from those who seek to get more money from the Earned Income Credit.
There are a few ways people use dependents to defraud the system. The most common ones involve divorce and non-existent nieces and nephews.
If there's concern about dependent fraud with a relation, it's time to hire a lawyer. They can stop the person, allowing the rightful custodian to obtain what is his or hers by law.