Tax fraud Feed

House Oversight Committee members also investigating ID.me contracts, verification methods Photo by cottonbro In early February, the Internal Revenue Service announced plans to transition from ID.me's facial scanning identity verification system. The third-party service's scanning technology raised privacy concerns. A few weeks later, the IRS elaborated on its taxpayer identity process. It said the facial recognition would remain, but as an option, not a requirement. Taxpayers instead could participate in a live, virtual interview to prove they are legitimately opening their own online taxpayer account. The IRS also indicated that it eventually would join other federal agencies in using Login.Gov,... Read more →


New phishing scam targets tax pros, but everyone needs to be on guard The Internal Revenue Service today warned tax professionals about a new spearphishing scam. I'm surprised we made it into February before the latest tax scam appeared. This email scam uses the IRS logo. It also tries to ramp up the already urgent tax season by using a variety of subject lines, such as "Action Required: Your account has now been put on hold." The IRS provided bogus text of this scam below. Your account has now been put on hold ALL preparers are required to apply security... Read more →


Photo by cottonbro from Pexels A planned conversion of taxpayer accounts to a system that required use of a third-party facial recognition system apparently is no more. IRS Commissioner Chuck Rettig announced the about face today in a brief statement. "The IRS takes taxpayer privacy and security seriously, and we understand the concerns that have been raised," said Rettig. "Everyone should feel comfortable with how their personal information is secured, and we are quickly pursuing short-term options that do not involve facial recognition." The agency is, in its words, transitioning away from its deal with ID.me, although that wasn't specifically... Read more →


Photo by cottonbro from Pexels The Internal Revenue Service is rethinking its decision to force taxpayers to use a private identity verification company in order to access their online accounts. The 180 came after blowback from Congress and consumer and privacy advocates. The reassessment doesn't mean the IRS is giving up on ways to strengthen its online security. Rather, according to a Treasury statement reported by Bloomberg, the IRS is looking at ways to "balance ease of taxpayer access" with increased protections against criminals who use stolen taxpayer identities to file for fraudulent tax refunds. The increased security raised public... Read more →


The Internal Revenue Service Criminal Investigation (IRS-CI) unit is my favorite section of the tax agency. Part of it is because I've always been fascinated by law enforcement. Add tax geek to the mix, and it's a natural fit. My investigative bent was bolstered when my first full-time job as a young newspaper reporter on the cop beat. Those West Texas police officers tried their best to intimidate and gross out this young woman. They failed. Many times, solving a crime also is like unravelling a mystery, especially when the crooks are inventive. As a life-long mystery fan, that component... Read more →


If you think online crooks are just going after big businesses, think again. Smaller firms are prime cyberattack targets. Go big or go home, unless you're a cybercriminal targeting businesses. More than 70 percent of cyberattacks are aimed at companies with 100 or fewer employees. That revelation is from the Internal Revenue Service and its Security Summit partners as this year's National Tax Security Awareness Week was winding down. It's also this weekend's By the Numbers figure. In going after smaller business, con artists target credit card or payment information, the business identity information, or data on employees. "Thieves may... Read more →


Gift cards make great presents for family and friends, but they cannot be used to pay taxes. (Gift card wreath via Pinterest) We all have people on our holiday gift lists who are hard — OK, impossible — to shop for. When I struggle to find the perfect gift, I follow my personal credo: Say it with cash. Or, more often, with plastic. Yes, I give gift cards. And if family and friends are reading this, I am happy to get them. But one place where gift cards aren't welcome is the Internal Revenue Service. This IRS is making a... Read more →


Most of us would love to win the lottery. And most of us know that hitting a jackpot means the U.S. Treasury is a winner, too. Taxes due on gambling winnings are just part of the price of such payoffs. But an Ohio man pushed his luck a bit too far. He's now awaiting sentencing on his attempt to evade taxes on a lottery jackpot. The Hillard, Ohio, man pleaded guilty this week in U.S. District Court to one count of filing a false tax return with the Internal Revenue Service in connection with his $1 million lottery win 2015.... Read more →


Shutterstock There's one terrifying ghoul who hangs around long after Halloween. In fact, he and his ilk have been busy all year. It's the tax scammer. The Federal Trade Commission (FTC) just this week warned that scammers are sending yet another phony Internal Revenue Service email about COVID-19 relief payments. "There's a fake IRS email that keeps popping into people's inboxes. It says that you can get a third Economic Impact Payment (EIP) if you click a link that lets you 'access the form for your additional information' and 'get help' with the application," says Cristina Miranda of the FTC's... Read more →


One of my favorite Lyle Lovett songs is "What Do You Do/The Glory of Love," where the Houston singer-songwriter shares the vocal spotlight with the incomparable Francine Reed. The lyric that initially caught my ear and makes me chuckle every time I hear it goes, "If you make all that money man, make damn sure it shows." That's a great exchange in a duet, but such showiness raised suspicions about a Dallas-area accountant accused of defrauding the COVID-19 Paycheck Protection Program (PPP). PPP fraud guilty plea: Steven Jalloul was indicted in September 2020 on charges he orchestrated a fraudulent scheme... Read more →


This has been a wonderful weather week here in the Austin area. Nights have been cool. Days have topped out in the seasonal upper 70s. But today is a tad warmer, a trend expected to continue through October. So it's goodbye to our brief autumn in Central Texas, and back to closing windows and cranking up the air conditioner. Don't get me wrong. I'm not complaining. Although it was hot this summer, it wasn't the hottest since we moved here 16 years ago. And after February's devastating ice storm, I'm never complaining about warm or warmer than normal or hot... Read more →


The loss of tax revenue is substantial, since most states collect tax (or are supposed to) on all their meals, from eat-in to pick up to delivery. Tasty and taxable. (Photo by Adrienn via Pexels) Running a restaurant poses many challenges. Dealing with increased food costs. Hiring and training staff. Finding an accessible and affordable location. Complying with health and other regulatory rules. Paying taxes. The tax consideration is getting special attention in California, where an extended investigation reveals that around a fifth of the state's restaurants are using high-tech methods to skip out on taxes. "The California Department of... Read more →


A record number of unemployment claims were filed due to COVID-19 layoffs. But billions of dollars of those benefits went to crooks who falsely filed for them. The weekly jobless reports from the U.S. Bureau of Labor Statistics (BLS) are always watched closely. They're seen as a sign of how well (or not) the economy is doing. The reports of how many people are (or aren't) looking for work have taken on added significance during the COVID-19 pandemic. The latest count was good news. BLS' Sept. 2 report showed that the United States saw the least number of new unemployment... Read more →


FTC Chair Lina Khan was one of the officials appearing at a House Energy and Commerce Committee hearing in June on the agency's plan to modernize consumer protection. (Screen shot from the committee's hearing video) Most Americans don't pay too much attention to who's in charge of the various federal agencies. But a few now are learning about Federal Trade Commission (FTC) Chair Lina Khan since her agency has renewed its antitrust lawsuit against Facebook. And others know the Biden Administration appointee because they are getting phishing emails using Khan's name in a COVID-19 payment scam. The email, purportedly from... Read more →


You'd think after almost 18 months of dealing with COVID-19, we'd all be wise to related scams. Apparently, we aren't. The coronavirus pandemic has been Christmas for con artists looking to cash in on all-too-common tales of woe and hardship, writes Los Angeles Times business columnist David Lazarus. He leads off his article with the tale of a crook impersonating the neighbor of a California couple. In an email that looked to be from the neighbor's real online address, the crook invoked an extended family COVID tragedy. But while carefully crafted, the con wasn't quite slick enough to fool these... Read more →


If you don't follow international taxes, you probably missed the CumEx story. The team of investigative reporters who uncovered the alleged tax fraud schemes back in 2017 characterized it as "the largest tax robbery in the history of Europe." Thirty-eight reporters from 19 newsrooms in 12 countries collaborated across borders to dig through 180,000 pages of documents related to the allected tax fraud. Just what did the alleged tax schemers do? The short version is, allegedly, that banks, stock traders, and lawyers obtained billions from European treasuries through suspected fraud and speculation involving investment dividend taxes. According to the journalists,... Read more →


The Internal Revenue Service has wrapped up its 2021 version of the Dirty Dozen Tax Scams. In announcing the cons by category, the agency was able to elaborate more on each trick on the list. In case you missed the posts earlier this week, here are the ol' blog's posts on each of them: Pandemic related scams, aka Part 1, which focuses on attempts steal COVID-19 Economic Impact Payments (EIPs) and other tax-related coronavirus relief distributed by the IRS, from Monday, June 28; Personal information cons, or Part 2, with a look at phishing, its cousin voice phishing or vishing,... Read more →


We regular folks tend to have a complicated relationship with the wealthy. And by complicated, I mean one-sided, unrealistic, and too often reverential. Being aspirational, we love to gawk at what they can get away with because of their money, and dream of one day being in their Manolos and mansions. That's fueled way too many not-really reality shows. Such hopes also are a big reason scammers can convince wealthy wannabes to fall for schemes that peddle false hopes of large tax deductions. In real-life tax reality, these dodges simply are a way to push hopeful taxpayers further away from... Read more →


What's the result when the worst things happen? Too often, it's terrible people taking advantage of good people. This occurs with alarming regularity in the tax world following tragedies and disasters. Con artists use horrible events to convince compassionate individuals to donate to groups that will help out the victims. What really happens all too often is the caring donors become victims, too. Fake charities are just one type of scam in today's third installment of the IRS' Dirty Dozen for 2021. This category of tax ruses in which dishonest people trick others into doing something illegal often includes fraudulent... Read more →


The COVID-19 pandemic presented new opportunities for crooks, as noted in yesterday's post on the first group of 2021's Dirty Dozen Tax Scams. Today, however, we're back with the golden oldies, as in trying to steal your gold. And your identity. These Personal Information Cons use a variety of techniques that have been around for years. There's phishing, its cousin voice phishing or vishing, Internal Revenue Service impersonators, social media trolling and tricks, and ransomware. Regardless of which illegal method is used, the goal is the same. Criminals try to get as much of your personal information as possible, including... Read more →