In an age dominated by digital transactions and virtual interactions, the proliferation of scams has reached unprecedented levels. At Advia, we recognize the growing threat posed by scams targeting individuals and businesses alike. As guardians of financial well-being, it's our mission to empower you with knowledge and resources to safeguard against these evolving threats.
Two trending scams worth exploring further include Internal Revenue Service (IRS) Tax Fraud and fraud related to the Corporate Transparency Act.
Tax Fraud Scams
As tax season hits its peak, scammers are ramping up their efforts to pilfer personal data. A recent report from the Treasury Inspector General for Tax Administration revealed that the IRS flagged over 300,000 fraudulent tax returns in the 2023 filing season, preventing nearly $2.7 billion in fraudulent refunds. While these figures are concerning, there are proactive measures you can adopt to shield yourself from tax-related scams, and we're here to assist you every step of the way.
To start, let's look at some of the most prevalent types of tax-related scams as outlined by the IRS:
- Phishing, Smishing: If you’ve received unsolicited emails (phishing) or text messages (smishing) claiming to be the IRS during tax season, the IRS says to delete them right away. The IRS will never contact you through email, text, phone, or social media requesting personal information. Their primary mode of communication is through regular mail.
- Social Media: Although social media is a useful tool for staying informed about current events and popular topics, it's also exploited by scammers to disseminate misinformation. Before trusting any tax-related content you encounter on social media, it's essential to verify its accuracy by consulting the IRS or a reputable tax advisor.
- Fake Online Account Help Representatives: Should you receive contact from a third-party representative offering help establishing your IRS online account, reject the proposition. Such individuals may be attempting to scam you into divulging your personal tax information.
- Made-Up Charities: If an organization claiming to be a charity contacts you, insists on immediate donations, pressures you, or requests donations through methods like gift cards or wire transfers, it's probably a scam. Prior to donating, verify the legitimacy of the charity using reputable websites like Charity Watch to assess the organization’s legitimacy.
To read more about a variety of specific tax related scams, visit the IRS website.
How To Report Tax Scams
According to the IRS, they will never initiate contact with taxpayers via email, text message, or social media to request personal information. You can check out this helpful article on how to tell if the IRS is really trying to get ahold of you for more information.
If you encounter a tax scam at any point throughout the year, you should report it to the IRS so they can investigate. You can also forward suspicious messages to phishing@irs.gov and note that it seems to be a scam phishing for your information.
In addition, as always, if you feel that you've been a victim of fraud, please contact Advia immediately. We also recommend reporting suspected fraudulent activity to the Federal Trade Commission (FTC).
Corporate Transparency Act Scam
Another scam that has been on the radar recently is regarding compliance with the Corporate Transparency Act, an actual federal law enacted on January 1, 2024. The Corporate Transparency Act mandates that legal business entities register with their state, reporting details like beneficial ownership and individuals with significant control within the company to FinCEN.
What is the scam?
It’s vital to understand that FinCEN does not initiate unsolicited requests containing access codes, links, or solicitations for information that could be exploited for business identity fraud.
If you get an email claiming to be from the U.S. Department of Treasury Financial Crimes Enforcement Network (FinCEN), be cautious. Several state Attorney General offices, including Michigan's, have sounded the alarm about a current scam that includes communications that contain links or QR codes directing to malicious websites aimed at stealing information or deploying malware onto devices.
To read more about this scam, check out the U.S. Department of the Treasury’s recent press release.
How to Stay Protected
If you find yourself caught in this scam, swift action is necessary. Reporting the incident is paramount. You can directly report it to FinCEN here.
Additionally, at Advia, we offer business solutions such as Positive Pay, which adds another layer of protection against check fraud. Your vigilance and swift response can mitigate the impact of such scams and safeguard your business's interests.
Advia is Here for You
At Advia, we take member financial safekeeping and identity protection seriously. When a member visits or calls, we take steps to confirm their identity before providing financial assistance. Our Digital Banking solutions provide state-of-the-art layers of account security, including secure access code protection and other strong password requirements.
If you feel that you've been a victim of fraud, please contact us right away.
Remember: by staying informed and vigilant of scams, together we can navigate the murky waters of fraud prevention and protection.
Sources:
Treasury Inspector General for Tax Administration: https://www.tigta.gov/sites/default/files/reports/2023-11/2024400006fr.pdf
Charity Watch: https://www.charitywatch.org/
IRS: https://www.irs.gov/newsroom/tax-scamsconsumer-alerts
FTC: https://reportfraud.ftc.gov/#/
U.S. Department of The Treasury: https://home.treasury.gov/news/press-releases/jy1974