It’s tax season, and every year around this time, the Internal Revenue Service (IRS) publishes a list of scams criminals use to try and ferret out personal information or steal money. (1) Your best defense against these criminal schemes is to be aware that they exist, so you know to keep your guard up, have the proper precautions in place, and take the appropriate actions if you fear you may have been targeted.

For example, if you received an email from a top executive in your company or organization requesting data from IRS form W2 for the previous tax year, what would you do? (2)

The safe answer is: Don’t respond.

Spoofing

Disguising an email to look like it’s from your boss or someone higher up in your firm is called spoofing. According to the IRS, criminals have been spoofing corporate employees for years, and now they’re turning their attention to school districts, tribal organizations, restaurants, hospitals, and nonprofits. (3)

Far too often, when an unsuspecting person receives an email from someone they trust or from an authority figure in an organization, they don’t question the request and willingly share sensitive information that cybercriminals can use to access their accounts and steal money or personal data.

If you receive a suspicious email, contact your Human Resources department.

Phishing

Merriam-Webster explains phishing like this, “…A common phishing scam involves sending emails that appear to come from banks requesting recipients to verify their accounts by typing personal details, such as credit card information, into a website that has been disguised to look like the real thing. Such scams can be thought of as ‘fishing’ for naive recipients.”  (4)

In other words, they are using bait to lure people into their scheme and casting a wide net.

If you receive an email purporting to be the IRS, remember this: The IRS does not contact taxpayers about refunds or tax bills using email, text, or social media. In fact, the agency cautions Americans not to click on a link in an email claiming to be from the IRS. (1)

In addition, banks and financial institutions typically won’t ask for confidential personal information (user names, passwords, personal identification numbers, and so on) through text message, email, or social media. One bank provided examples of fake emails that had been sent to its customers. Here’s how it reads: (5)

Dear account holder,

Due to concerns for the safety and integrity of your online account, we have issued this warning message. It has come to our attention that your account information needs to be updated due to inactive members, frauds, and spoof reports.

We ask you to visit the following link to start the procedure of confirmation on customer data.

To get started, please click HERE.

Please don’t reply directly to this automatically-generated email message.

As you can see, a message like this tends to sound legitimate, giving recipients little reason to suspect that it’s fake. This is why the best defense is to be aware that schemes like this exist. Instead of clicking on a link in a suspicious email or text, call your local bank branch or IRS office to ask whether they sent the request.

Phone Scams

Be wary if you receive a call and the person says they are from the IRS – even if caller ID says it’s the IRS and the person on the other end of the line offers a badge number and official-sounding title – because it’s likely a scammer. (6)

Criminals have been impersonating IRS agents and demanding immediate payment of taxes without giving the taxpayer an opportunity to question or appeal the amount owed.

They may threaten the taxpayer with arrest, deportation, or another punishment, but the IRS does not do this. Scammers may also require a specific payment method, such as a prepaid debit card, or insist taxpayers provide credit or debit card numbers over the phone. Don’t do it. (6)

Instead of engaging, take the caller’s information, refrain from giving out any of your information, and tell them you will call back. Then, look up the number for your local IRS office; don’t use the number provided by the caller. Call the official number to confirm whether the caller is an actual IRS employee or not.  (6)

Identity Theft

Criminals have been using other people’s personal information (Social Security numbers, names, addresses, birth dates, etc.) to obtain money or credit for many years. Recently, scammers have also been filing false tax returns.

The IRS has implemented measures that appear to be effective. (1) At the end of 2016, USA Today reported, “An unprecedented public-private crackdown has helped cut taxpayer identity theft reports in half and prevented millions of dollars in fraudulent refunds.”

However, regardless of the progress made, the IRS cautioned, “Taxpayers need to watch out for identity theft, especially around tax time. The IRS continues to aggressively pursue the criminals that file fraudulent returns using someone else’s Social Security number. Though the agency is making progress on this front, taxpayers still need to be extremely cautious and do everything they can to avoid being victimized.”

If you discover someone has filed a tax return using your personal data, Intuit.com advises you to complete IRS Form 14039 and mail it to the IRS right away. (7) It’s important that you stay on top of this and begin taking steps to protect yourself immediately.

Every year, tax season means open season for scammers who want to steal your personal information for criminal purposes. Spoofing, phishing, phone scams, or identity theft can wreak havoc on your financial circumstances and sense of security.

As we’ve discussed all week, your best defense against these criminal schemes is to be aware that they exist, so you know to keep your guard up, have the proper precautions in place, and take the appropriate actions if you fear you may have been targeted.

Being wary can help protect against scammers, but criminals can still find a way to capture your personal information regardless of any precautions you take.

If you worry your data may have been compromised, the Federal Trade Commission suggests considering a credit freeze, which lets you restrict access to your credit report and makes it more difficult for identity thieves to open new accounts in your name.

You’ll still be able to open new accounts or allow credit checks by prospective employers or landlords, but you’ll need to unfreeze your account for that purpose specifically. To learn more, contact one of the credit bureaus: Experian (http://www.experian.com), Equifax (https://www.equifax.com/personal), or TransUnion (http://www.transunion.com). (8)

It’s up to you to protect yourself and your family against unscrupulous criminals this time of year and year-round.

 

Sources:

1 https://www.irs.gov/uac/newsroom/irs-summarizes-dirty-dozen-list-of-tax-scams-for-2017

2 https://www.edsurge.com/news/2017-02-07-phishing-season-widespread-email-scam-targets-schools-edtech-companies

3 https://www.irs.gov/uac/dangerous-w-2-phishing-scam-evolving-targeting-schools-restaurants-hospitals-tribal-groups-and-others

4 https://www.merriam-webster.com/dictionary/phishing

5 https://www.chase.com/digital/resources/privacy-security/security/suspicious-emails

6 https://www.irs.gov/uac/newsroom/phone-scams-continue-to-be-a-serious-threat-remain-on-irs-dirty-dozen-list-of-tax-scams-for-the-2016-filing-season

7 https://turbotax.intuit.com/tax-tools/tax-tips/General-Tax-Tips/Identity-Theft–What-to-Do-if-Someone-Has-Already-Filed-Taxes-Using-Your-Social-Security-Number/INF23035.html

8 https://www.consumer.ftc.gov/articles/0497-credit-freeze-faqs

 

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This material was prepared by Crystal Marketing Solutions, LLC, and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate and is intended merely for educational purposes, not as advice.

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