The end of the financial year is near. So all of us — especially those scrambling at the last minute to get their receipts in order — should keep an eye out for the accompanying onslaught of tax scams.
Posing as the Australian Taxation Office in particular has been a key vehicle for scammers to target victims, with considerable success over the years.
According to an Australian Competition and Consumer Commission report , scams targeting Australians last year cost an estimated $851 million. Reported financial losses over the past five years show a clear upward trajectory.
And while this is clearly concerning, it only represents a proportion of the overall problem, as many victims are unlikely to report being scammed .
Scams come in various forms. Often they will use social engineering to convince victims to reveal personal information or to participate in their scheme. They rely on the same emotional triggers marketers use to encourage purchasing .
The excitement of chasing (and getting) a good deal leads to a feeling of self-satisfaction that’s hard to resist. Bargain-hunting, in other words, makes us feel smart . But it doesn’t mean we smart.
Criminals rely on this to bypass a potential victim’s rational brain and appeal directly to their emotions. Scams will often frighten victims with threats of financial or even criminal penalties .
Scammers will use any event or entity as an opportunity to undertake fraudulent behaviour. The ATO therefore presents them a valuable opportunity, as having to interact with it at some point is a near-universal experience for Australians.
Phone scams in particular have attracted a lot of attention. The ATO has even provided a real example online to warn the public.
Tax time is the perfect opportunity for scammers , as taxpayers are often time-poor, working to a deadline and are conscious of the legal consequences of failing to comply.
Receiving an email, SMS or voice call at this time of year with a tax-related matter has an air of legitimacy (we expect them) and a sense of urgency (we don’t want to be fined).
But illegitimate demands for payment and requests for information can lead to huge financial losses and identity fraud.
How to spot scams
While the ATO does phone and send text messages to individuals, it will never ask you to make a payment to nullify an arrest warrant, nor will it threaten you with revoking your Tax File Number, as is done in some scams. It also won’t ever call you using prerecorded messages.
These messages are known as ” RoboCalls “. They can range from sounding quite genuine to being almost laughable. In either case, if you ever wish to follow up you should contact the ATO directly. Do not respond to the message, and do not provide any information.
Moreover, don’t trust an email or website based simply on its appearance. Anyone can copy the ATO’s website and branding .
If you are suspicious of a communication you’ve received, the best way to react is to not react. Take a breath, count to five and ask yourself whether what you’re looking at seems legitimate. Is it unusual in any way?
Scammers rely on victims acting quickly on impulse. Pausing and reflecting is the best weapon against social engineering. Take time to consider who the message is from. What are they asking you to do, and why?
What to do if you get scammed
If you know you’ve been scammed, or suspect you may have been, the first step is to contact the ATO (always using the phone number on the official website ). You can also report the incident directly via the ATO’s report a scam page, or through ScamWatch .
If you’ve already lost money to scammers, unfortunately there are limited options because most scams send stolen money to offshore accounts, making recovery almost impossible. If you’ve bought gift cards you can talk with the retailer , but most are non-refundable.
If you have made a funds transfer or credit card payment, you should contact your bank to see if the funds can be recovered (and speed is crucial here ).
Year after year, we can’t avoid doing our taxes. But if we’re careful, calm and aware, we can at least avoid being taken advantage of by scammers.
Paul Haskell-Dowland is associate dean in Computing and Security at Edith Cowan University. Nathalie Collins is Academic Director of National Programs at Edith Cowan University. This piece first appeared on The Conversation .
- Credit society scam: Jaipur court directs probe into complaint against Gajendra Shekhawat
- New Income Tax forms are out: Know the four key changes
- Income Tax Return: Check fine for late filing and misreporting income
- ITR Filing FY 2019-20: Deadline to claim tax benefits under Section 80C expires today
- Are you due a $1,080 tax rebate? How to maximise your tax return - as 108,000 Australians rush to submit theirs in record time
- Tax returns 2020: Why your refund could be smaller this year
- GOP may face choice on tax cut or stimulus checks
- Two in three Americans want to see Trump's tax returns, Reuters/Ipsos poll shows
- MPs launch inquiry into pension scams after savers were fleeced of £10billion by cynical fraudsters
- Tax avoidance, expenses scams – welcome to the recruitment industry
- Founder of Silicon Valley firm is jailed for six months in college admissions scam after paying $1M to get his daughter into Georgetown by pretending she was a star tennis player as judge blasts millionaires who think the law doesn't apply to them
- How To Amend A Tax Return
- How E-assessment makes dealing with the tax department a smooth affair
- Supreme Court grants bail to Bengali journalist arrested in alleged ponzi scam
- George Floyd murder suspect Derek Chauvin charged with tax crimes
- No income tax refund yet? A step-by-step guide to checking status and reasons for delay
- Chinese students in Australia are being scammed into faking their own kidnapping
- Derek Chauvin, fired Minneapolis police officer, and his wife charged with tax crimes
- Donald Trump launches new bid to keep his tax returns secret from New York DA's Stormy Daniels probe calling subpoena 'presidential harassment'
- Scandal Over $2 Billion Fake Gold Bars in China Makes Bitcoin Alternative Look Stronger
'We have filed a case under your name': How tax scams make $851m in a year have 1180 words, post on www.abc.net.au at June 18, 2021. This is cached page on Europe Breaking News. If you want remove this page, please contact us.