Mark Pribish

Here's how to fight back against rampant ID theft, tax-refund fraud

By Mark Pribish
Vice President and ID Theft Practice Leader

Not just the IRS and you are preparing for income-tax filing season - ID-theft criminals are getting ready to attempt to steal and use your name and Social Security number. They want to get your tax refund and more in 2016.

It's a giant and growing problem, with one-third of all consumer complaints to the Federal Trade Commission tied to tax-related identity theft. It's the No. 1 complaint.

Chances are you are at an increased risk, as the trend is up for five years in a row.

How do you know if you are a victim of taxpayer ID theft and refund fraud? Typically, victims lean about their predicament when their tax return is rejected because ID theft criminals filed first. When the real taxpayers file, their refunds aren't paid until the IRS resolves their individual case.

If you are required to file, do so at the earliest possible moment - this reduces your risk.

The Internal Revenue Service paid out $5.8 billion in fraudulent refunds in 2013, according to a January 2015 General Accounting Office tax and identity theft report. As a result, the IRS has opened a special office and unit to handle identity-theft cases.

What can we taxpayers do to minimize the risk during the 2016 tax-filing season?

First, every individual needs to remember that tax-filing documents from employers, financial institutions, financial-services firms, health-care providers and insurance companies, along with others, are being sent via the U.S. Post Office and email.

At the same time, thieves and fraudsters will be trying to steal your personal information from the U.S. Post Office, your mailbox and your personal and business email accounts.

Second, research your tax preparer for any negative past history, as there have been numerous news stories of tax preparers being arrested and convicted of stealing tax refunds using stolen identities.

Think about it. We give our tax preparer our most personal information, including our Social Security number and those of our family members. Your preparer knows about your financial assets, your bank account information, kids' information and even your marital status - so be vigilant on who you trust to do your taxes.

Finally, the IRS has a great link on tips for taxpayers and victims of identity theft as the IRS continues to take new steps and strong actions to protect taxpayers and help victims.

Among the tips:

  • File an FTC complaint.
  • Contact one of the three credit bureaus to place a fraud alert on your account: www.Equifax.com: 1-800-525-6285; www.Experian.com: 1-888-397-3742; or www.TransUnion.com: 1-800-680-7289.
  • Close any financial accounts opened without your permission.
  • Respond immediately to any IRS notice, according to instructions.
  • Complete IRS Form 14039, Identity Theft Affidavit.

Additional resources include this IRS Identity Protection link and the FTC Identity Theft link.

ID thieves want your tax refund, so beat them to the punch by filing your 2015 taxes as soon as possible.


To learn more about these threats and how to protect yourself and your family from Identity Theft, you can read my past newsletters at the Merchants Identity Theft Educational Website at www.idtheftedu.com.


How to Spot the Real OPM Data Breach Letter

Be wary of notification emails coming from OPM.

December 15, 2015

The U.S. government's Office of Personal Management (OPM) has been notifying those affected by a recent cyber security breach that their personal data was compromised. Unfortunately, scammers are also "notifying" consumers. Here's how to identify a real OPM notification letter and the signs of a scam.

How to Spot a Real OPM Letter:

You don't have to be a U.S. federal employee to receive a notification from OPM. The breach was wide reaching, and there are many ways your personal information may have been included. Common ones include:

  • Past and present federal employees
  • Spouses and other co-habitants listed on federal background investigation applications
  • Applicants for a federal job
  • Those who worked or volunteered with a federal agency but are not federal employees

Real Letters Contain:

  • A 25 digit PIN to register for credit and identity monitoring services. Make sure your PIN is real by entering it at opm.gov/cybersecurity
  • Instructions to visit the website opm.gov/cybersecurity to get more information and sign up for monitoring.

Signs of a Scam:

Scammers love to take advantage of large government initiatives. Scams surrounding the roll out of the Affordable Care Act are a recent example. Be on the lookout for scammers attempting to cash in on this effort.

  • OPM will not contact you for personal information. OPM, nor anyone acting on OPM's behalf, will contact you to confirm personal information. If you are contacted by anyone claiming to represent OPM DO NOT share your information.
  • Email is not used in this round of notifications. OPM did email to notify those affected by the breach this past summer. This time, they are sending letters by U.S. Postal Service. An email claiming otherwise is a scam.
  • Lost your PIN or didn't receive a letter? If you have not yet received a letter but think you have been impacted, you can contact the verification center at opm.gov/cybersecurity or by phone.

For More Information:

Learn more about the data breach and the U.S. government efforts to notify those affected on OPM's website.

Check out BBB's Top 10 Scams of 2015: bbb.org/top10scams

To find out more about other scams, check out BBB Scam Stopper (bbb.org/scam).

To report a scam, go to BBB Scam Tracker (bbb.org/scamtracker).

Courtesy of the Better Business Bureau - for more information visit http://www.bbb.org/phoenix/news-events/

If you believe your identity has been stolen, call 866.SMART68 today.