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Scam of the Month: IRS and Tax Scams

As spring comes to a close and the long days of summer begin to roll in, we can safely say that we have officially put tax season behind us. Everything has been filed, filled, and submitted; if you were entitled to a return, you even have some extra cash in your bank account. The sun is out and everything is looking a little bit brighter. But then the phone rings. It is a call from “Account Services” about a tax debt relief program; worried it could be important, you answer and hear this:

“Hello, this is a very important state-wide update. The state requires us to inform those on our list that have tax debt about the new economic impact tax debt modification program that is now offered during the special enrollment. The economic impact program has been designed to significantly reduce or eliminate your IRS tax debt as it is now considered temporarily non-collectible. This is big savings for those struggling with IRS tax debt however the window for the special enrollment will soon close so please call us back at…”

This automated message is just one of the many examples of information phishing that Hiya has captured in our honeypot. At the beginning of June, the IRS reported that they had seen a consistent threat of tax and employment-related scams.  The COVID-19 pandemic has elongated the period in which scammers and fraudsters go searching for your tax information; stimulus packages, high unemployment rates, and extended deadlines have caused a level of confusion amongst the tax-paying population. 

How Big Did the Scam Get?

Hiya captured millions of calls made by potential scam callers. Out of this sample size, IRS and tax scams reached about 1.5% of the captured calls. During April and May of 2022, the traditional tax season, the number of fiduciary spam calls was at its peak sitting at just under six million; in June the number dwindled slightly but remained a significant problem.

These seasonal scams can have surprising longevity in the voice channel because of their high pick-up rates. Over 20% of the potential IRS scam calls were answered; this high level of effectiveness is due in part to the sensitive nature of the scam itself. When these false calls are answered there is a high probability that you will be kept on the phone for well over five minutes—especially if they are trying to get you to call them back at a premium number. These scam calls are so convincing that their call duration far surpasses the average length of a typical answered call. The longer a bad actor can keep someone on the phone, the higher the likelihood that they will be able to ascertain valuable information about your identity or finances.

Variants to Watch Out For

IRS scams come in all shapes and sizes; in some cases, you will receive a very obvious recorded call about some “tax relief program”, but in other instances, the call you receive could be far more convincing. With all of these tax scams plaguing the voice channel, it is important to be aware of what to look out for. Common variants to look out for include:

Stimulus Scams

  • After the last federal stimulus package was introduced into the economy, identity thieves began to use these Economic Impact Payments (EIPs) to siphon information from individuals. As a reminder, the IRS has already issued all valid EIPs, so if you receive a call asking for any financial information it is most likely a scam.

Unemployment Fraud

  • After the pandemic, many people lost their jobs and began to rely on government assistance. Bad actors who have successfully ascertained some personal information will take advantage of the influx in unemployment by filing fraudulent compensation claims.

Debt Relief

  • Money can be tight during the tax season, especially when it is framed within the set of a national crisis. This is a perfect time for scammers to take advantage of taxpayers who are in debt or have been put into debt by their annual payments. Be on the lookout for calls offering tax relief in exchange for any personal information.

What Can You Do?

With intricate and effective scams—like the IRS scam—infiltrating the voice channel it can be easy for customers to lose confidence in your outbound calls. Here are a few tips for maintaining control over your identity:

  • Keep your customers up to date and well informed
    • Remember that the IRS will not initiate communication by asking for Social Security numbers or any other financial information
  • Brand your outbound calls so they are not mistaken for a scam
    • A branded caller ID solution is the perfect tool for protecting your reputation. If you provide your customers with identifying information they will feel safe answering your calls.
  • Utilize call assessment services offered by reputable third-party networks
    • An outside eye can be a useful tool for the development and optimization of your voice channel. Learn the ins and outs of your call center; you’ll be much more likely to recognize spam patterns

If spoofers and scammers are taking advantage of your outbound calls, it is imperative that you regain control of your identity. When customers see a call they don’t recognize they are unlikely to answer the phone, even if that call is legitimate. Be sure to protect your reputation with a branded caller ID solution.

How to fight back against scam calls

Carriers can protect their customers from phone scams by adding Hiya Protect, which blocks or labels spam and scam calls with high accuracy, without blocking essential calls. It is used by phone carriers, mobile phone manufacturers, and network providers who are looking to create a differentiated voice offering and increase customer satisfaction.

Enterprises can help their customers feel safe answering the phone by adding Hiya Connect, which enables businesses to display their company name, logo, and reason for the call on the recipient’s mobile phone. Branded caller ID identifies who is calling so customers will not be afraid to answer their phones.

Individuals can check with their phone carrier to see if it offers spam/scam blocking capabilities. If not, ask your carrier to consider adding Hiya Protect.

Author Hiya Team

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