Tax-Rebate Scams

Government Tax Agencies Do Not Solicit Your Personal Information by Phone or Email

In 2008, the U.S. government enacted an economic stimulus package to blunt the effects of a recession. The stimulus included a $100 billion tax rebate program, and 130 million letters were sent out to citizens to inform them in advance how much they would be receiving. By mid-year checks averaging $950 had already arrived at more than 70 million American households.

Scammers were already busy at work.

What makes tax rebate scams relatively easy to set up and operate. The scammers phone or email their intended victims, identify themselves as a representative of the Internal Revenue Service (IRS), Social Security Administration (SSA) or another tax-collecting government agency and inform them that they are due to receive a rebate for having overpayed on their taxes.

Neither the IRS nor the SSA, nor their counterparts in other Western countries, however, collects information about government rebate qualifications by telephone or email.

Tax Rebate Scams by Phone

If the initial contact is made by phone, the unsuspecting consumers, who naturally are overjoyed to hear the unexpected news that they’re due a tax rebate, are then told that the payments will be made electronically, directly into their bank accounts or appear as credit on their credit cards. So they willingly provide the scammer with their bank account or credit card numbers and a few more details to confirm their identities. Both sides conclude the discussion on a positive note and the scammers inevitably say “thank you very much, we’re happy to refund you your money.”

Tax Rebate Scams by Email

If the contact is made by email, they will often include a link to an official-looking – but phony – website that looks like the real thing but is simply a phishing expedition, waiting for the victim to type in his or her personal information and then click on “submit.” Or, the link may install spyware or some other form of malware before continuing on to a legitimate government site. In that case, the implanted program will deliver the victim’s personal information back to the scammers when he or she types it in.

Either way, these crafty crooks then use the information they have gained to commit identity theft, draining the bank account of funds or charging huge cash advances using the credit cards.

International Tax Rebate Scams

Tax rebate scams quickly spread abroad, especially to Britain, Australia and New Zealand. In those countries, one popular scenario is for the victim to be told that the rebate can only be activated if a (comparatively) smaller sum be sent by wire to a supposed government agency, such as a “Department of Finance” or “Office of State Revenue.” This, so the story goes, is because the rebate is only valid if the total tax collected surpasses a certain sum. Once it does, however, the taxpayer will receive a rebate much larger than that one additional payment. But, once again, there is no rebate and no connection whatsoever with any government agency.

In January 2018, British tax authorities requested that 150 different websites involved in tax rebate scams be taken down. "In the run up to the self-assessment tax deadline of 31 January criminals ramp up their efforts to rip off honest taxpayers,” Her Majesty’s Revenue & Customs warned.

Always be on the alert when anyone who contacts you out of the blue asks you to transfer money by wire. Scammers prefer this route because it’s considered the most difficult to reverse. Here’s some bad news for the scammers: MyChargeBack offers its clients wire transfer recalls.

If you think you have been victimized by a carbon credit trading scam, consult with our fund recovery experts at MyChargeBack.