Beware: Call from IRS is not what it seems

08/08/2014 10:41 PM

08/08/2014 10:41 PM

It’s the kind of phone call that gets your attention in a hurry.

A pushy voice, with a vaguely foreign lilt, insists he’s an IRS agent and threatens to arrest you within hours unless you pay past-due taxes with an immediate electronic money transfer.

Even the caller ID makes it seem legit, popping up as 800-829-1040, a real IRS phone number.

It’s all bogus, of course, but that didn’t make it any less scary, said two local men who have had to calm nervous friends and clients over the last couple of months as what federal officials have called the “largest ever” IRS telephone scam rolled through the Kansas City area.

“It’s fear,” said Joe Cumley of All American Tax in Olathe. “The IRS is one of the most powerful entities in the world. … That’s the reason the scam works.”

A month ago, a client called Cumley on a Saturday to say that he had just cleaned out his bank account — $6,800 — and sent it via a prepaid cash card to someone who had identified himself on the phone as an IRS agent and threatened him with arrest.

The “agent” demanded $3,200 more to clear the debt.

The client “said, ‘I don’t know where I’m going to get the rest of this money,’” Cumley said.

Cumley quickly figured out that his client had been scammed, in part, because the methods of the “agent” didn’t at all resemble how the IRS normally works. The IRS usually contacts people with tax problems first by U.S. mail, not with phone calls or emails, Cumley said.

The victim, a small-business owner in the construction industry, had been working with Cumley to get current on his income and self-employment taxes. But money lost to a scam artist does not count as payment toward the taxes actually owed, Cumley noted.

So Cumley’s client has even less money to satisfy his tax debt.

“It was very unfortunate, and it hurt the guy financially,” Cumley said.

The IRS phone scam has been active nationwide since last fall and has taken more than $1 million from its victims, federal authorities estimated.

IRS spokesman Michael Devine said the scam can include these elements:

The caller claims to be an IRS agent, recites a bogus badge number and may even know the last four digits of the victim’s Social Security number.

The caller ID may have been “spoofed,” showing an official IRS phone number or a law enforcement agency.

Bogus emails may arrive to support the calls.

Follow-up calls may roll in, even if the victim hangs up and refuses to talk.

The caller demands that money be sent through Paypal or a prepaid cash card.

“The IRS will never call you and demand that you give us your credit card number or other personal information,” Devine said. “That first contact will be a letter — white paper and black ink that will tell you exactly what you need to do.”

Kansas City criminal defense lawyer John P. O’Connor knows how intimidating the calls can be. Over the last two months, he’s received a half-dozen calls from panicky friends and clients who were convinced that tax agents were on the way to arrest them.

The callers “are relentless,” O’Connor said. “Everyone who called me was crying, and everyone who called me thought it was the real deal.”

Pindrop Security, a private telephone security company in Atlanta, has been tracking the IRS phone scam for months and estimated that it likely targeted about 450,000 potential victims in March alone.

The scam likely is based in India, though the caller ID spoofing often makes it appear as if the calls are originating in Washington, D.C., the company’s research found.

Once Pindrop investigators identified phone numbers used by the scam, they had a researcher call, pretending to return a phone message left by the scam artists.

Their recorded call, reported in full on the company’s website, concludes with the clear threat of arrest, after the researchers declined to send along more than $2,400 in “warrant cancellation fees.”

“I’m telling you, sir, we are now taking this matter in legal ways, because I think you are running out of the situation,” the fraudster said. “I will forward this file to your local county sheriff department right now. … They will come to arrest you, sir.”

Ann from Kansas City, who asked that the newspaper not use her last name to avoid further harassment, heard from the fraudsters in late June.

The caller, she said, knew her maiden and married names and gave her an IRS badge number. He announced they were reviewing her taxes from 2008 through 2012 and demanded to know whether she had “criminal representation” because she owed $3,800 to the government.

“We know this is not innocent,” the scam artist said, Ann recalled. “We know it is an attempt to defraud the government.”

Shaken, Ann begged off the call before the demands for money became even more insistent. As she tried to reach her husband, the phone rang for 20 minutes with follow-up calls from the scam artists.

“Clearly, the point of that call was to scare me,” Ann said.

Before long, she’d been put in touch with O’Connor, who’d researched the scam and calmed her down.

In fact, O’Connor said, he’s kind of enjoyed being able to tell nervous callers that they probably don’t owe thousands of dollars to the IRS and that federal agents certainly aren’t on the way to arrest them.

“It was almost like telling someone, ‘You don’t have cancer,’” O’Connor said. “It was great.”

To reach Mark Morris, call 816-234-4310 or send email to mmorris@kcstar.com.

Be very suspicious if you receive an unexpected call from someone claiming to be a federal tax agent because initial contacts about unpaid taxes always are made by U.S. mail, said IRS spokesman Michael Devine. Hang up, he suggested, and take these steps:

Call the IRS at 1-800-829-1040 to confirm whether or not you owe taxes.

Report the incident to the Treasury Inspector General for Tax Administration at 1-800-366-4484 and the Federal Trade Commission at www.ftccomplaintassistant.gov/.

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