Mark Pribish

Secret Service Alerts Tax Filers to Taxpayer ID Theft Fraud

By Mark Pribish
Vice President and ID Theft Practice Leader

Last January I wrote an article titled ID Theft Criminals Steal and Use your Name and Social Security Number to Get Your Tax Refund (please see here) on how consumers and small businesses need to increase their awareness and education of tax identity theft.

As I have written for many years, one of the best defensive strategies is for consumers to file their income tax returns as early as possible each year, even if they have to amend their tax returns later.

Typically, ID theft victims learn about taxpayer ID theft refund fraud when their tax return is rejected because an ID theft criminal filed first. When the real taxpayer files, their refunds are not paid until the IRS resolves their individual case, which can take months.

According to a February 4, 2019 Secret Service press release (please see here), the Secret Service issued a "Tax Season Phishing Alert" reminding tax filers of scams attempting to steal both consumer and business data.

The release states that the "Secret Service alert reminds readers that we in the United States are entering tax season, which typically brings a large spike in scams designed to siphon personal and financial data."

It also reported that "recent successful phishing campaigns leverage all spoofed employer and financial institution websites to trick the victim into believing they are transacting on a legitimate website" and that the Secret Service "annually investigates frauds aimed at human resources employees in an attempt to obtain W-2 and other tax related documents."

Over the last few years, the Internal Revenue Services (IRS) has found that tax data can be stolen in numerous ways including the "theft of mail or tax returns, phishing emails from impostors or hacks of tax firms and employers' personnel records. Some tax scammers file in the name of deceased taxpayers or steal children's identities to claim them as dependents."

Fortunately, a combined effort by the IRS, state tax agencies and the tax-preparation business sector is recording significant declines in the number of phony returns since 2015.

Tax Papers

However, ID theft criminals and fraudsters will not end their efforts to commit taxpayer ID theft and refund fraud as they continue to develop new and innovative ways to use tax information for illegal gains.

That said, the Secret Service has offered these four "quick tips" on how to avoid taxpayer ID theft and refund fraud:

  • Never click on links embedded in emails or open any attachments from an unknown or suspected fraudulent email account.
  • Always independently verify any requested information originates from a legitimate source.
  • Visit websites by inputting the domain name yourself.
  • If needed, then update/change your information. If you are contacted over the phone, hang up, look up the phone number for the institution, and call back. Do not give your information over the phone.

If you are victimized by taxpayer ID theft and fraud, call the IRS Identity Protection Specialized Unit at 800-908-4490 and notify your state tax agency.

Based on the above, consumers and small businesses need to stay up to date and vigilant on the latest identity theft and data breach trends and scams. This Federal Trade Commission link (https://www.consumer.ftc.gov/articles/tax-related-identity-theft) on Tax-Related Identity Theft can help consumers and small businesses uncover and deal with tax-related identity theft.


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.


Scam Alert: Scammers Gear Up For Tax Season With This Con

By Better Business Bureau. January 11, 2019.

The New Year means the start of tax season. The Federal Trade Commission is warning people to be on the lookout for suspicious calls that claim to be from the Social Security Administration. Scammers are ramping up their efforts to steal Social Security numbers to use in filing fraudulent tax returns.

How the Scam Works

You answer the phone, and it's someone alleging to be from the Social Security Administration (SSA) or another government entity. The name on your caller ID may even back that up that claim. The caller says your social security number has been used to fraudulently apply for a credit card or commit another crime. In order to fix the situation, the caller needs you to confirm your SSN and other personal information. If you don't cooperate, the caller threatens to take you to court or have your Social Security number blocked or revoked.

No matter the details, the stories are designed to induce fear. Scammers hope that under pressure you will tell them your SSN and other sensitive personal information. Scammers can use SSNs to commit identity theft and file tax returns in your name to steal your refund.

How to Avoid the Scam

  • Never give personal information to unsolicited callers. If someone contacts you without your permission, refuse to tell them any personal information.
  • Remember, the SSA will never call you asking for your Social Security number. They will never ask you to pay anything, nor will they threaten your benefits.
  • Don't trust your caller ID. The internet has made it possible for scammers to use fake IDs when they call your home. If you receive a suspicious call, don't make any important decisions based on what your caller ID says.
  • Contact the Social Security Administration: If you are concerned about a call you received from someone who claims to be with the SSA, you can call the real SSA at 1-800-772-1213 (TTY 1-800-325-0778).

For More Information

To learn more about other kinds of scams, go to BBB.org/ScamTips.

If you've been targeted by this scam, help others avoid the same problem by reporting your experience at FTC.gov/Complaint and BBB.org/ScamTracker.

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