According to a June 25, 2015 report from the Treasury Inspector General for Tax Administration, the watchdog agency gets roughly 12,000 calls a week to its fraud hotline. The reason, says Inspector General Russell George, is because of the “largest, most pervasive IRS impersonation scam in the history of this agency.”
This is the scam I wrote about in recent issues of this newsletter and which I discuss extensively in my new book, How to Win Your Tax Audit. A caller telephones a target, claims to be from the IRS and makes outrageous claims that the target will be arrested and will go to jail within the next day if he does not pay delinquent taxes immediately using a credit card. Believe it or not, just within the last week, my son received such a call and I even got one at my home phone number.
Incredibly, the scam works—or at least it works often enough to keep the scammers in business. According to George, “More than 3,300 taxpayers have lost a reported $16.8 million to these criminals, who fraudulently claim to be IRS officials.” He went on to say in his statement that “the federal tax system’s integrity has never been more challenged.”
Why Can’t the IRS Shut These People Down?
That’s a simple question but the answer is not so easy. For one thing, they operate offshore. They are not U.S. citizens and frankly, they have very little practical knowledge of IRS procedures, which is painfully evident when you hear one of their phone messages, or talk with them, as I have done several times. Somehow they bounce their calls through U.S. phone lines so that one’s caller ID shows a U.S. phone number as the incoming line (usually from a Washington, D.C. area code) and the return phone number for calling back is also to a U.S. number.
“Because of the complexity of their operations, scams such as these are not typically resolved quickly,” George said. That could be the understatement of the year. TIGTA’s Office of Investigations is working to identify perpetrators. However, I can’t imagine that much progress will be made when compared to the sheer volume of calls these criminals make. It seems like everybody is getting
these calls. And since the criminals are operating offshore, how would you prosecute them, even assuming you could be a case against them?
Don’t forget that the easiest thing in the world to say to any caller who makes any kind of legal claim against you, as I state in How to Win Your Tax Audit, is “put it in writing.” Don’t ever respond over the phone to demands for information or money, especially from someone claiming to be from the government.
This article was part of the July 2015 issue of Dan Pilla's monthly electronic newsletter, Pilla Talks Taxes.
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