Tax Scams – Using the IRS for Scamming

Posted on February 6, 2024

Tax Scams – Using the IRS for Scamming

Tax scammers use the IRS name and logo to make themselves appear legitimate to taxpayers. In a recent tax scam, fraudsters pretend to be the IRS and send unsolicited emails to foreign financial institutions (FFIs) to extract clients’ private information. Scammers are exploiting the new rule that requires FFIs to report their U.S. clients’ financial activity to the IRS. They use this rule to coerce FFIs to share sensitive information with them, which they then use to conduct identity theft and financial crimes.

Scammers usually focus on individuals, rather than financial institutions. The elderly and immigrants are often frequent targets for scammers.  They’ve been known to use the IRS logo, names and even copy signatures. Fraudsters duplicate the design and look of an IRS web page to elicit private information such as a taxpayer’s Social Security Number, name and date of birth, and his or her filing status. After collecting this information, they’re free to carry out identity theft and other crimes.

In another recent IRS phone scam, fraudsters pretend to be IRS agents. They threaten taxpayers with imprisonment or severe penalties if they do not transfer money immediately.

Thousands of taxpayers have fallen victim to these scams, losing millions of dollars. In order to avoid falling victim to fraud attempts, taxpayers should stay current on the latest scams and report unsolicited calls or suspicious messages.

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