By Steve Horn, CPA and Tax Partner
We reported this summer about phone scammers posing as Internal Revenue Service (IRS) employees to harass their targets into paying allegedly-owed taxes. The U.S. Justice Department announced in late October that it has indicted and arrested dozens of individuals in the U.S. and India for alleged involvement in an international criminal organization that has stolen hundreds of millions of dollars through this phone scam. This comes on the heels of a raid earlier that month on nine Indian call centers that resulted in the arrest of 70 individuals.
U.S. authorities hope to send a clear message around the world that scammers will be pursued, caught and prosecuted.
“We are extremely vigilant when the names of U.S. government agencies are used to perpetuate fraud,” said U.S. Attorney for the Southern District of Texas Kenneth Magidson.
The indicted and arrested individuals allegedly posed as IRS employees and called thousands of innocent Americans demanding immediate payment for fictitious tax debts. In the largest single case, a scammer extorted $136,000 from a victim. On the calls, the scammers would threaten arrest, imprisonment or fines if immediate payment wasn’t received. Victims who agreed to pay were instructed to purchase stored-value cards which the scammers then used to buy reloadable debit cards.
The Treasury Inspector General for Tax Administration (TIGTA) has been tracking and investigating the scam since 2013. Scammers have also been reported impersonating Department of Homeland Security employees. Other schemes included operators offering small short-term loans or grants in return for a good-faith deposit or processing fee.
The investigation and prosecution is a victory for both the U.S government and American people. However, scams and scammers will continue to find ways steal money from taxpayers. We recommend that our clients remain vigilant as we enter tax season. If you are contacted by someone claiming to represent the IRS or another agency and who asks for money, take these additional measures to ensure that you do not become a victim:
- Never give personal or financial information to someone who calls you.
- Hang up on anyone who calls you, claims to be from a U.S. government agency, and demands payment.
- Call TIGTA (800-366-4484) and contact the Federal Trade Commission (gov) to report the call.
- Call the IRS (800-829-1040) or visit gov to check on your tax status if you have any questions.
- Contact me or any of the tax professionals on my team (770-512-0500) if you want to discuss any communication you receive about your taxes.
The tax professionals on my team and I are available to discuss any communication you receive about your taxes. It is better to be safe than sorry. Please call me if you have any questions.