Blog Post

Beware of Treasury Department Scams!

moneyA few weeks ago, I had quite a scare.

The phone rang and because I didn’t recognize the number, I let it go to the answering machine. That's when I heard someone with a very heavy accent leave a very startling message for me:

“This is the Department of Legal Affairs at the U.S. Treasury and I’m calling to notify you that an action has been started against you. Please return this call and make sure you have a lawyer present.”

I had no idea what kind of action he was talking about because I didn't owe any money (at least not to the best of my knowledge) and always paid my taxes on time.

About the only odd thing I noticed about the call is that the number where the call originated was not the same as the number this person asked me to use when I returned the call.

The problem is that this call came about a minute before I was scheduled to do a live radio show so I barely had time to react and I was on the air!

But just as soon as we came to the first break in the show, I played the message back and prayed, “Jesus! What is this about? Could you help me?”

A moment later, I had a sudden urge to google, “Department of Legal Affairs scam”.

And there it was – the largest ever phone scam in the U.S. which has raked in an estimated $14 million from 3,000 victims as of January, 2015.

Essentially, the scammers claim to be calling from the IRS or Treasury Department to inform the victim that they owe taxes and must pay using a pre-paid debit card or wire transfer.

In some cases, such as in my own, the victim is told to get a lawyer, or are threatened with immediate arrest, deportation or loss of business or driver’s license if they refuse to pay.

For example, in this particular case, which was an undercover probe by a news organization, the caller told the intended victim that “You need to retain the best attorney in town who can arrange a bail for you so you can be out of jail.”

In another case, a man was told that his wife failed to pay her 2009 taxes to the IRS and that a policeman was coming to their home to arrest her.

IRS"You're in violation of the law and your wife will be arrested," the caller said, and then proceeded to give him the last four digits of his wife’s Social Security number!

These scammers are good, and they know what they're doing, which is why the scope of the scam has become large enough to warrant attention from the Treasury Department.

“It is critical that all taxpayers continue to be wary of unsolicited telephone calls from individuals claiming to be IRS employees,” said J. Russell George, Treasury Inspector General for Tax Administration in a January, 2015 press release.

“This scam, which is international in nature, has proven to be the largest scam of its kind that we have ever seen. The callers are aggressive, they are relentless and they are ruthless,” he said. “Once they have your attention, they will say anything to con you out of your hard-earned cash.”

He added: “The increasing number of people not only receiving but accepting these unsolicited calls from individuals who fraudulently claim to represent the IRS is alarming. At all times, and particularly during the tax filing season, we want to make sure that innocent taxpayers are alert to this scam so they are not harmed by these criminals."

Do not become a victim, he says. "This is a crime of opportunity, so the best thing you can do to protect yourself is to take away the opportunity. Do not engage with these callers. If they call you, hang up the telephone.”

It’s important to note that the IRS usually contacts people by mail, not by phone, about unpaid taxes. And they never ask for payment via a pre-paid debit card or wire transfer or ask for a credit card number over the phone.

“If someone unexpectedly calls claiming to be from the IRS and uses threatening language [such as, “you better get a lawyer!”] if you don’t pay immediately, that is If you owe Federal taxes, or think you might owe taxes, hang up and call the IRS at 800-829-1040. IRS workers can help you with your payment questions,” George suggests.

These scams are also taking place by e-mail so be careful not to open these messages or any attachments that might come with it. The IRS never requests personal or financial information by email, texting, or any other form of social media.

If you do receive a call or email, you should file a complaint with the FTC and add “IRS Telephone Scam” to the comments section of the complaint.

If you receive an email, forward it to phishing@irs.gov

The good news is that it’s a scam, so you can breathe a great big, PHEW! The bad news is that too many people are being tricked into sending their hard-earned money to these con artists - which is why it's a good idea to spread the word to your family and friends.

 

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