Aggressive phone calls from scammers posing as IRS agents threatening court action against victims if they don’t send payments was found to be the most common telephone scam in a recent study.
It’s a simple scam, a telephone call from someone claiming to be with the government and demanding payment for past-due taxes, or in some cases offering large refunds. The obvious giveaway, though, is they require personal information be given over the phone.
A recent survey conducted by CPR Call Blocker, a company that sells devices that block unwanted calls, determined the IRS scam during tax season is No. 1 in a list of the Top 5 telephone scams to which Americans fall victim.
The study also found that 11 percent of U.S. adults have been a victim of a telephone scam. Of those who have been scammed, 20 percent said they had lost between $500 and $10,000 as a result.
1. IRS tax season scam
More than one in three people surveyed claimed to have been a subject of an IRS phone scam. The IRS called the tax scam the “headliner of its ‘dirty dozen’” list of tax scams in 2016.
“This January, the Treasury Inspector General for Tax Administration announced they have received reports of roughly 896,000 contacts since October 2013 and have become aware of over 5,000 victims who have collectively paid over $26.5 million as a result of the scam,” according to an IRS news release.
The problem is just as common in Ottawa County.
“We have taken hundreds of reports this tax season from victims who have received calls from people posing as agents and saying, ‘You owe a balance and a warrant will be issued for your arrest if you don’t provide debit card numbers or bank account numbers,” said Capt. Mark Bennett, with the Ottawa County Sheriff’s Office.
He said the department has taken hundreds of other reports of victims claiming they attempted to file their taxes through an online service to find out someone else had already filed their return.
Bennett said the best defense against this is to simply hang up. Although the more advanced scammers can mask the phone call to appear as if it is coming from a legitimate IRS phone number, the IRS does not contact people over the phone to collect taxes.
He said the IRS will send notified mail to anyone it is trying to reach regarding unpaid taxes.
2. Credit/loan scams
The second most common telephone scam comes in the form of offers of new or upgraded credit cards. About one in three people claimed to have been victim to this scam attempt.
Scammers call and offer lower rates, higher limits or anything else to draw victims in. Then, Bennett said, they say all they need is a social security number.
“The next thing you know, the identity is stolen from the person and there are these charges on an unauthorized card,” he said.
The best way to avoid this scam, according to Bennett, is to not give out any information over the phone. If it appears a credit service or a bank is offering an upgrade or new card, he said to hang up and call the bank directly to find out if it is legitimate.
Another common scam is that of which a caller is notifying someone of winnings, often in the form of money but also trips or packages. About one in four people surveyed said they had received a call of this nature.
Bennett said in Ottawa County there have been several complaints of a caller claiming the person won a Jamaican lottery and just needed to pay the taxes on the winnings before receiving the full amount.
“I’ve been to Jamaica a couple times and I’ve never seen a Jamaican lottery,” Bennett said half-jokingly. “I’m not saying they don’t have one, I’ve just never seen one.”
The point is, he said, unless it was a contest the person specifically entered or signed up for, it’s likely a scam.
“Never give your personal information over the phone unless you’ve initiated the call and are purchasing something from a reputable or legitimate vendor,” he said.
4. Banking scams
Less common locally, but with up to one in five people nationwide reporting to have received a call from a person claiming to be a banker, these scams are trying to get victims to offer up bank account numbers.
Bennett said the most common complaints of banking scams come from victims stating a bank has called them claiming there were insufficient or low funds in an account and would like a payment in order to maintain a minimum balance.
He said scammers will also try to get victims’ bank account numbers by claiming an issue with the server at the bank and bank officials need to check the account to make sure there were no fraudulent activities.
“Just hang up and call the bank or go to the bank and see if there is an issue with balance,” Bennett said.
5. Automated messages
This type of scam can vary in technique, and can include any of the previous four scams. The difference is, however, is an automated message that often attempts to get victims to enter bank account or social security information using their dial pad.
He said oftentimes the caller is attempting to “verify” a purchase or some transaction.
“We’ve seen tragic cases of people who have lost hundreds of thousands of dollars in these types of scams,” Bennett said. “It’s tragic. People think in good faith they’re taking part in a business transaction and they are just having their life savings ripped from them.”
Bennett said anyone who gets an automated message asking for personal information to simply hang up.
Telephone scams continue to be used by criminals as a way to steal identity, receive payments and establish credit cards in other people’s names.
Bennett said they can be hard to prosecute because several originate from outside the country. The sheriff’s department does work alongside the IRS and other federal agencies in reporting and investigating scams.
More often than not the scams are unsuccessful in baiting their victims, Bennett said. But with the quantity of calls that scammers are able to make because they purchase phone numbers through companies who build databases of customer contacts, even a low success rate can prove lucrative.
He said people who are retired are most often targeted because they are more often home to answer the phone and are more likely to have available funds and assets.
For more, visit “Tax Scams and Consumer Alerts” on IRS.gov and anyone who suspects they are a victim of a scam can contact the IRS or a local police agency.