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Scam Alert: IRS Urges Taxpayers to Watch Out for Erroneous Refunds; Beware of Fake Calls to Return Money to a Collection Agency

Posted By Lisa Novack, IRS, Friday, February 16, 2018

IR-2018-27, Feb. 13, 2018

WASHINGTON — The Internal Revenue Service today warned taxpayers of a quickly growing scam involving erroneous tax refunds being deposited into their bank accounts. The IRS also offered a step-by-step explanation for how to return the funds and avoid being scammed.

Following up on a Security Summit alert issued Feb. 2, the IRS issued this additional warning about the new scheme after discovering more tax practitioners’ computer files have been breached. In addition, the number of potential taxpayer victims jumped from a few hundred to several thousand in just days. The IRS Criminal Investigation division continues its investigation into the scope and breadth of this scheme.

These criminals have a new twist on an old scam. After stealing client data from tax professionals and filing fraudulent tax returns, these criminals use the taxpayers' real bank accounts for the deposit.

Thieves are then using various tactics to reclaim the refund from the taxpayers, and their versions of the scam may continue to evolve.

Different Versions of the Scam

In one version of the scam, criminals posing as debt collection agency officials acting on behalf of the IRS contacted the taxpayers to say a refund was deposited in error, and they asked the taxpayers to forward the money to their collection agency.

In another version, the taxpayer who received the erroneous refund gets an automated call with a recorded voice saying he is from the IRS and threatens the taxpayer with criminal fraud charges, an arrest warrant and a “blacklisting” of their Social Security Number. The recorded voice gives the taxpayer a case number and a telephone number to call to return the refund.

As it did last week, the IRS repeated its call for tax professionals to step up security of sensitive client tax and financial files.

The IRS urged taxpayers to follow established procedures for returning an erroneous refund to the agency. The IRS also encouraged taxpayers to discuss the issue with their financial institutions because there may be a need to close bank accounts. Taxpayers receiving erroneous refunds also should contact their tax preparers immediately.

Because this is a peak season for filing tax returns, taxpayers who file electronically may find that their tax return will reject because a return bearing their Social Security number is already on file. If that’s the case, taxpayers should follow the steps outlined in the Taxpayer Guide to Identity Theft. Taxpayers unable to file electronically should mail a paper tax return along with Form 14039, Identity Theft Affidavit, stating they were victims of a tax preparer data breach.

Here are the official ways to return an erroneous refund to the IRS.

Taxpayers who receive the refunds should follow the steps outlined by Tax Topic Number 161 - Returning an Erroneous Refund. The tax topic contains full details, including mailing addresses should there be a need to return paper checks. By law, interest may accrue on erroneous refunds.

If the erroneous refund was a direct deposit:

  1. Contact the Automated Clearing House (ACH) department of the bank/financial institution where the direct deposit was received and have them return the refund to the IRS.
  2. Call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) to explain why the direct deposit is being returned.

If the erroneous refund was a paper check and hasn't been cashed:

  1. Write "Void" in the endorsement section on the back of the check.
  2. Submit the check immediately to the appropriate IRS location listed below. The location is based on the city (possibly abbreviated) on the bottom text line in front of the words TAX REFUND on your refund check.
  3. Don't staple, bend, or paper clip the check.
  4. Include a note stating, "Return of erroneous refund check because (and give a brief explanation of the reason for returning the refund check)."

The erroneous refund was a paper check and you have cashed it:

  • Submit a personal check, money order, etc., immediately to the appropriate IRS location listed below.
  • If you no longer have access to a copy of the check, call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) (see telephone and local assistance for hours of operation) and explain to the IRS assistor that you need information to repay a cashed refund check.
  • Write on the check/money order: Payment of Erroneous Refund, the tax period for which the refund was issued, and your taxpayer identification number (social security number, employer identification number, or individual taxpayer identification number).
  • Include a brief explanation of the reason for returning the refund.
  • Repaying an erroneous refund in this manner may result in interest due the IRS.

IRS mailing addresses for returning paper checks

For your paper refund check, here are the IRS mailing addresses to use based on the city (possibly abbreviated). These cities are located on the check’s bottom text line in front of the words TAX REFUND:

  • ANDOVER – Internal Revenue Service, 310 Lowell Street, Andover MA 01810
  • ATLANTA – Internal Revenue Service, 4800 Buford Highway, Chamblee GA 30341
  • AUSTIN – Internal Revenue Service, 3651 South Interregional Highway 35, Austin TX 78741
  • BRKHAVN – Internal Revenue Service, 5000 Corporate Ct., Holtsville NY 11742
  • CNCNATI – Internal Revenue Service, 201 West Rivercenter Blvd., Covington KY 41011
  • FRESNO – Internal Revenue Service, 5045 East Butler Avenue, Fresno CA 93727
  • KANS CY – Internal Revenue Service, 333 W. Pershing Road, Kansas City MO 64108-4302
  • MEMPHIS – Internal Revenue Service, 5333 Getwell Road, Memphis TN 38118
  • OGDEN – Internal Revenue Service, 1973 Rulon White Blvd., Ogden UT 84201
  • PHILA – Internal Revenue Service, 2970 Market St., Philadelphia PA 19104

 

To view the original article, please visit the IRS website here.

Tags:  IRS  Scam  Security  Small Business  Taxes 

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What You Need to Know About the Equifax Data Breach

Posted By Kenyatta Turner, LegalShield Independent Associate, Friday, September 15, 2017

What you need to know about the Equifax Data Breach:

Equifax, Inc – a major credit bureau, announced on Thursday, 9/7/17, that a massive data breach was discovered in July, which may have exposed names, birth dates, Social Security numbers and addresses of approximately 143 million U.S. consumers. The current US population is approximately 326 million, so this data breach potentially affected 44% of Americans! In addition, a smaller amount of driver’s license numbers, credit card numbers and certain documents were obtained. The breach lasted from mid-May to July of 2017.

This is just the latest example of how, no matter how careful you are, there are forces beyond your control that can still lead to your personally identifiable information being exposed.

At IDShield, we know how stressful data breaches are, and we are here to help.  As a member, please know:

  • You have full access to our dedicated and experienced licensed private investigators to ask any questions and get help if you are worried that you are a victim of fraud.
  • You have proactive credit monitoring through Experian and will be alerted if there are any changes to their credit report.

If you are not a member of IDShield, there are still steps that you can take to provide an extra layer of security.

  • First, set up a fraud alert. This will reduce the chance of a fraudster opening a credit or loan account in your name. If you place the alert with one bureau, they will ensure its placed on the other bureaus as well. Fraud alerts last for 90 days, but can be renewed. You can search online for placing a fraud alert and select one of the main bureaus to set it up through. To sign up via Experian, use this link: https://www.experian.com/fraud/center.html. To sign up via TransUnion, use this link: https://www.transunion.com/fraud-victim-resource/place-fraud-alert.
  • Second, be diligent. Don't give out your personal information if it sounds fishy. IDShield members, if you're unsure, this is a great time to call your licensed private investigator for advice!
  • Third, change your passwords for online banking and other finance accounts. This will reduce the risk of your money or assets being moved fraudulently. As you change your password, use your IDShield Vault password manager to generate a new strong password!

And of course, if you don’t yet have IDShield, this is a great time to sign up for comprehensive identity protection and full service, white glove restoration. Visit www.idshield.com to learn more!

 

I'm here to help, so please do not hesitant to contact me!

Kenyatta Turner, LegalShield / IDShield Independent Associate, 602-367-1069

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Tags:  data breach  financial  financing  fradulent  fraud  hackers  identity protection  law  lawyer  Legal  legal advice  legal services  legalshield  lending  loans 

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America is Now Known as the Land of the Free and Home of the Hacked

Posted By Kenyatta Turner, LegalShield Independent Associate, Saturday, April 8, 2017

America is Now Known as the Land of the Free and Home of the Hacked

by David Coffey, Opinion Contributor - 3/31/17

 

Unfortunately, Americans are now familiar with identity theft, from having experienced it themselves or personally knowing a victim of this insidious crime.

The Consumer Sentinel Network, maintained by the Federal Trade Commission (FTC), tracks consumer fraud and identity theft complaints. Of the 3.1 million complaints received in 2015, 16 percent were related to identity theft, which represented an increase by more than 47 percent from 2014. In fact, identity theft is reported as America’s No. 7 fear — before economic collapse and right after biowarfare.

This is not at all the case in Europe. Except for the U.K., our neighbors across the Atlantic barely know about identity theft. There are a number of systemic reasons for this happier situation, and some of them should inspire our policymakers here in the U.S.

Identity theft starts with the misappropriation of a victim’s personal identifiers. I am sure that none of the readers of this article would ever write their home address or license plate number on their set of keys. Then, by the same logic, why would they be okay with having their identity’s safety rely on a single all-purpose identifier?

Just like an armored door is built with numerous reinforced key points, an identity should be protected via the combination of more than one identifier. This is common sense. Unfortunately, this is not how our system works — and the culprit is our social security numbers (SSNs).

SSNs were created in 1936 to keep track of the earnings history of U.S. workers for Social Security benefit computation purposes. Their purpose was limited. Today, SSNs have become the national identifier used by both the government and the private sector as a way to identify and gather information about an individual’s financial life.

Efforts have been undertaken to curb this expansion, from legislation such as the prohibition of displaying the SSN on driver's licenses or motor vehicle registrations, to recommendations including the President's Identity Theft Task Force asking that federal agencies reduce the unnecessary use of SSNs, which they called “the most valuable commodity for an identity thief,” and the FTC’s plea to private entities to find better ways to authenticate identities.

Despite these efforts, SSNs still reign unchallenged. An identity thief only needs to get his or her hands on the 9-digit number, which is registered in many places, to steal a person’s identity and wreak havoc in their lives, from opening fraudulent credit card accounts to filing fake tax returns and more. But in Europe, social security numbers are used for retirement benefits only. An identity thief would need a person’s national ID number, which appears in very few places, and banks often additionally require a copy of a passport or identity card to prove an identity.

Once the fraudster has gone to the trouble of acquiring these precious personal identifiers, he’ll want to make money off it. And what better way than to gain access to the victim’s bank account? In America, where the use of credit cards is largely accepted, the damage an identity thief can cause is immense, because it is not limited to the amount of money present is the victim’s bank account when the theft occurs. A huge sum of credit card debt can be amassed by a thief on a shopping spree.

Meanwhile, the majority of Europeans use debit cards, which limits the losses one would endure. What’s more, the United States is one of the last countries to still use magnetic strips which are easy to replicate and therefore more liable to identity theft. European countries use a system called EMV, which adds a security layer in the form of a PIN to credit card purchases.

Part of the shift to cards embedded with an electronic chip to greatly boost security, the PIN system was introduced in the U.S. starting in 2013, but despite the liability shift — entailing that retailers who do not buy the technology used to authenticate transactions be held accountable for any fraud that occur in their store — only 37 percent of U.S. stores now accept chip cards.

It will take some time for banks to update all of their ATMs. Besides, thieves have already found a way around it: they simply create a new bank account under the victim’s name, or make purchases online where the PIN number is not required.

At the end of the day, protecting oneself and one’s family from identity theft requires each of us to take decisive steps. Control your personal identifiers closely. Sign up for monitoring of your accounts, so you’ll get a warning of unusual activity. Finally, if your identity is stolen, be prepared to have a private investigator take the necessary steps to restore your identity to its pre-theft status.

Dave Coffey is senior vice president and chief digital officer of LegalShield, a leading provider of protection against identity theft solutions.

 

Kenyatta Turner, MM
Independent Associate | Executive Director
Business Solutions | Employee Benefits
www.kenyattaturner.com | (602) 367-1069 
 

Tags:  Employee Benefits  fradulent  fraud  identity protection  identity theft  Legal  legalshield  mobile apps 

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Businesses Beware: Don't Get Hooked into Paying for Forms You Don't Need

Posted By Teresie Zmyslinski., Jennings, Strouss & Salmon, PLC, Wednesday, March 22, 2017

By: John “Jack” G. Sestak, Jr., Member, Jennings, Strouss & Salmon, P.L.C.

Over the years, I have come across what appear to be “official” correspondences from companies portraying themselves as state-related representatives. Their purpose is to “scare” a business into hiring them to prepare form corporate documents, stating that all corporations must file annual reports with the Arizona State Corporation Commission; however, many businesses, such as limited liability companies, are not required to file annual reports. In addition, the letters offer to prepare annual director and shareholder meeting minutes at fairly significant rates.

The bottom line – understanding your business structure and its reporting requirements is extremely important to ensure you are compliant. It is also prudent to prepare and retain annual director and shareholder meeting minutes; however, do not get hooked into paying “service” firms for forms you may not need, or that may be substandard or simply false. It is in a company’s best interest to confer with its attorney, or seek experienced legal counsel, regarding business filings, compliance and other legal needs.


John “Jack” G. Sestak, Jr. represents small, medium and large companies in all areas of business and commercial litigation. He advises clients with matters related to corporate, administrative, creditors' rights, securities litigation, real estate, employment, professional negligence, and environmental matters.  

Mr. Sestak is an experienced litigator and has assisted with a broad range of commercial litigation issues, including general contract disputes, shareholder and partner disputes, employment issues, and arbitration proceedings. In addition, Mr. Sestak handles business and commercial transactions of all kinds, providing counsel and advice on business planning, as well as dispute resolution. He has also represented major financial institutions in dispute resolution and litigation matters. Mr. Sestak can be reached at 602.262.5827 or jsestak@jsslaw.com

Tags:  legal services 

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Arizona Supreme Court Upholds Arizona Prop 206

Posted By Teresie Zmyslinski., Jennings, Strouss & Salmon, PLC, Wednesday, March 15, 2017

 

By: Otto S. Shill, III, Attorney, Jennings, Strouss & Salmon, P.L.C.

The Arizona Supreme Court has unanimously upheld Arizona Proposition 206, which, effective January 1, 2017, increased Arizona’s minimum wage to $10.00, and requires employers to provide paid sick leave to employees beginning July 1, 2017. 

The statute, known as the Fair Wages and Healthy Families Act, is the result of a 2016 voter proposition. It has been highly contested by numerous business organizations; however, with this decision, employers must take immediate steps to ensure that they (i) are compliant with the minimum wage requirement already in effect, and (ii) prepare for the policy and recordkeeping changes that will be required for the addition of paid sick leave benefits beginning July 1.

While legislative efforts may be forthcoming to make changes to this law, permissible changes are limited because it was passed by voter initiative. So, a higher minimum wage, as well as paid sick leave for all Arizona employees, is now a reality that employers must acknowledge. The labor and employment team at Jennings, Strouss & Salmon is available to help evaluate your current plans and assist with the creation and implementation of new or revised policies to ensure your business is compliant. 

_____________________________________________________________________________

Employers have many options for hiring labor and employment legal representation; however, unlike Jennings, Strouss & Salmon, few encompass the reputation, history, experience, and full-service functionality under one roof.

Minimum wage and overtime issues under the Fair Labor Standards Act create unique challenges for employers. We offer creative solutions and swift litigation support. From internal compliance audits to Department of Labor investigations, we guide clients through the maze of regulations to ensure they comply with the ever changing laws, and defend clients facing wage and hour litigation in both individual and collective claims.

Our labor and employment attorneys are also experienced at handling the wide-range of employment issues that challenge businesses, big and small. They regularly assist clients in hearings before numerous administrative agencies, such as the EEOC, OSHA, NLRB, OFCCP, U.S. Department of Labor, Arizona Civil Rights Division, and the Arizona Department of Economic Security. In addition, our labor and employment attorneys are skilled litigators, defending clients in all types of lawsuits brought before state and federal courts (both trial and appellate). They also assist our clients in resolving disputes through negotiation, mediation, arbitration, early neutral case assessment and other alternative dispute resolution techniques.

For assistance with any of your labor and employment needs, please contact one of our experienced labor and employment attorneys:

John J. Egbert - johnegbert@jsslaw.com - 602-262-5994
Chris M. Mason - cmason@jsslaw.com - 602-262-5817
Otto S. Shill -  oshill@jsslaw.com - 602-262-5956
John "Jack" G. Sestak, Jr. - jsestak@jsslaw.com - 602-262-5827
Lindsay G. Leavitt - lleavitt@jsslaw.com - 602-262-5825

Tags:  employment  legal services 

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