We’d love to say we’ll see a downturn in scams in 2016, but that’s not likely.
Fraudsters will take the scams they’ve been pulling in 2015, give ’em a little twist, and start all over again.
Speaking of twists, there’s a change that will give new credibility to con artists who impersonate the IRS, and it’s a big deal.
Indeed, the fraud in which bad guys impersonate the IRS was the No. 1 scam for 2015, according to the Better Business Bureau. The scammers say you owe back taxes and if you don’t pay immediately, you could face arrest, wage garnishment or liens.
It’s probably going to get worse before it gets better, thanks to a new provision in the recently passed federal budget.
The provision allows government debt collectors to make robocalls.
That’s right, robocalls.
And they can now be made to your cell phone.
Before the passage of this regulation, known as Section 301, it was illegal for debt collectors to robocall cell phones.
And it’s not just the IRS that can call. Now debt collectors can call you to collect on student loans, mortgage debt and other outstanding loans.
It’s not only debtors who may get harassing calls. Relatives of debtors, or even those who have cell phone numbers that once belonged to debtors, can get the calls.
This provision has been greeted with disdain by consumer advocates, who say too many consumers are already besieged by con artists who pose as government officials. The fraudsters try to get your personal information, or they try to get you to send them cash.
The fake callers increase their attempt at authenticity by making their Caller ID look like it comes from Washington, D.C.
But now that government debt collectors can legally call debtors, it will be that much harder for consumers to know if a call is legit or not.
To battle this, Sen. Bob Menendez co-sponsored a bill, known as the HANGUP Act, short for Help Americans Never Get Unwanted Phone calls Act. It would swipe these new calling powers out from under government agencies by repealing Section 301.
“With more and more family time being interrupted by nuisance phone calls and predatory scams, we should be strengthening consumer protections, not carving out more exceptions,” Menendez said. “Encouraging federal agencies to robocall individuals only creates confusion that scammers will inevitably exploit to rip people off. We need clearer rules and stronger consumer protections to make sure no one falls victim to a telephone scam.”
But unless or until that bill is passed, we wanted to know what, exactly, federal agencies would do to make sure consumers didn’t confuse scam calls with legitimate ones.
“Taxpayers should be aware that IRS may call them but we make first contact through a postal letter. If IRS doesn’t hear back from you, then we may need to phone,” said IRS spokeswoman Patricia Svarnas. “However, if anyone calls threatening arrest, audits, deportation, etc., it’s a scam and they should hang up. That’s not how we do business at the IRS.”
Talk is that if the feds retain this calling power, there will be certain consumer protections put in place.
But until they are, Bamboozled recommends that you hang up on any caller who claims to be collecting a debt for the federal government. Then, independently find a legitimate phone number for the agency, and call that number. If the agency was really calling for you, it should be able to verify the issue.
If you’re not all that worried about privacy and you think Section 301 is worth it to get delinquent borrowers to pay up, consider this note from our friends at Consumerist.com.
It offered this great chart citing a review from the Congressional Budget Office (CBO), which found Section 301 would have a minute effect on collecting federal debts over the next 10 years.
Consumerist.com said based on the CBO chart, it’s estimated that such calls could net a maximum of $500,000 a year, or $5 million over 10 years. That’s a tiny portion of the debt, of which student debt alone is more than $1 trillion.
“It seems a bit like using a mop to clean up Lake Michigan,” Consumerist.com said.
Other scams to watch for
Identity theft was the biggest complaint to the Federal Trade Commission in 2014. We’re still waiting for the 2015 data.
ID theft scams come in many flavors, but they all come to the same disastrous conclusion. Hucksters will use any means necessary to get your personal information, whether it’s dumpster diving (yes, bad guys still go through your garbage and steal your mail, so maybe a shredder is a good holiday gift for your last-minute shopping) or electronic trickery.
They’ll use that information to take out fake loans and credit cards in your name, and then leave you to clean up the mess.
Fake emails and malware:
While your spam filter may stop some fake emails, others are bound to get through as scammers come up with new ways to fool your virus software. These communications may impersonate a company or bank you do business with, a brick-and-mortar or online retailer, or really, anyone.
If you receive an email from any institution and it directs you to click a link to go to a website to update your private information, don’t. Delete it. Then visit what you know to be the legitimate website, independently, to verify whether or not the communication was the real thing.
Among the most common imposters are those who claim to be the IRS, a government agency offering free grants, and those who said you won a sweepstakes or lottery. Just be on the lookout.
And remember that if someone tells you your computer or mobile device has been locked or is facing a technological problem, don’t call the number they provide. Instead, contact your provider independently to seek help.
Be sure to keep your anti-virus software updated, but know it’s not infallible. You also need to be on guard and use your common sense.
Social media scams:
The purpose of social media is to share, so be prepared for your friends to share all kinds of fakery — unintentionally.
If they post an item that says someone is giving out free money, skip it. If the post says you can click a link to earn money, skip it. And be sure to skip the ones that offer free gift cards or products for sharing a page or emailing information to your friends.
These are all just ways the scammers try to get their phony offers in front of a bigger audience.
Chip card scams:
If you haven’t received your new chip cards in the mail yet, you’re a target for scammers. Not all consumers will have their new cards by the end of 2015, so this will continue into next year.
Consumers have reported they’ve received phone calls from scammers who say they’re calling from a bank or credit card company. They ask for personal information to authenticate your new chip card, or say that something in your account needs to be updated because of the new cards.
When you receive your new card, you’ll be given an 800-number to call to activate your card. You won’t get a separate phone call from the card issuer.
If you get a call, hang up and call your lender to see if really tried to contact you.
Have you been Bamboozled? Reach Karin Price Mueller at Bamboozled@NJAdvanceMedia.com. Follow her on Twitter @KPMueller. Find Bamboozled on Facebook. Mueller is also the founder of NJMoneyHelp.com. Stay informed and sign up for NJMoneyHelp.com’s weekly e-newsletter.