COVID Feature: Coronavirus Schemes Are Spreading Fast

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Hacking and criminal concept.A hacker in a secret hiding place is neon light.

The IRS Criminal Investigation (CI) division is warning taxpayers about increasing fraud from COVID-19-related schemes. These types of scams prey on fragile Americans during unprecedented circumstances. (Fraudsters won’t hesitate to abuse programs meant to help people through financially difficult times.)

COVID-19-related scams vary in methodology and can be difficult to detect. One common scam is creating fraudulent charities that claim to be collecting funds for people affected by the coronavirus. (It might sound like they are doing a good deed, but they’re actually padding their pockets.) Another type of scam includes companies that are purportedly on the verge of creating a vaccine. Fraudsters lure investors in by promising stock options at a low price and lucrative profits once the vaccine is created. (Everyone wants in on a good deal.)

There are also many electronically generated scams that use fraudulent emails, text messages, website links, and social media to gather personal information from unsuspecting users. (Fraudsters are adapting their tactics as technology expands and are not afraid to use any platform as part of their exploits.)

These phishing schemes often look legitimate to the untrained eye. Users are commonly asked to confirm their personal information so they can receive their economic stimulus payment. Someone who is still waiting on their payment could easily mistake this for an additional step needed to receive their stimulus check. (People are desperate for financial assistance and in the eyes of a fraudster, their desperation makes them easy prey.) 

There are also reports of employees receiving fraudulent emails with eye-catching subject lines claiming a co-worker has tested positive for the coronavirus. Once opened, recipients become exposed to embedded malware that captures data from their computer. The main goal of phishing schemes is to steal sensitive information that could give fraudsters access to their victims’ financial accounts.

The CI division is working with domestic and international law enforcement partners to monitor for COVID-19 scams and bring the perpetrators to justice. The IRS is also taking preventative measures to educate taxpayers about the warning signs of fraud schemes and encourage them to be wary of who they give their money or personal information to.

Coronavirus-related (COVID-19) scams should be reported to the National Center for Disaster Fraud (NCDF) Hotline at 1-866-720-5721 or through a form on their website. 

Today’s Fraud of the Day comes from an article, “IRS warns against COVID-19 fraud; other financial schemes,” published by The Huntsville Item on June 8, 2020.

The Internal Revenue Service today reminded taxpayers to guard against tax fraud and other related financial scams related to COVID-19.

In the last few months, the IRS Criminal Investigation division (CI) has seen a variety of Economic Impact Payment (EIP) scams and other financial schemes looking to take advantage of unsuspecting taxpayers. CI continues to work with law enforcement agencies domestically and abroad to educate taxpayers about these scams and investigate the criminals perpetrating them during this challenging time.

 

 

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.