SACRAMENTO – The Franchise Tax Board (FTB) has issued a warning to businesses and individuals that identity theft and refund fraud schemes are off to a rampant start this filing season.
Employers in particular are a target for scammers disguising themselves as human relations officers in order to steal employee data. When criminals are able to successfully steal an employee’s information, they often file a fraudulent tax return in an attempt to claim and redirect a taxpayer’s refund.
About 100 businesses employing 126,000 individuals were hit by scammers last year. By comparison, about 80 businesses have already been targeted in the first weeks of this tax season. Tax season traditionally runs from January to Tax Day, which falls on April 18 this year.
“Protecting personal information is always important, but fraudsters are even more prevalent during tax season,” said State Controller Betty Yee, chair of FTB. “Our FTB team is working hard to weed out fraudulent returns and ensure tax refunds go to the rightful taxpayers.”
With the help of enhanced fraud detection practices, FTB identified and prevented more than $70 million worth of refund theft during fiscal year 2015-2016, up from more than $28 million during fiscal year 2014-2015. FTB also works with the IRS Security Summit and Federation of Tax Administrators to help detect and stop identity theft and refund fraud.
FTB advises human resources officers to be wary of any suspicious W-2 data requests that come from outside of the business. This could be the work of scammers seeking to commit identify theft.
FTB urges individual taxpayers to be cautious of the following:
- Any phone call or email requesting passwords or information about credit cards and bank accounts. FTB agents never ask for these details.
- Threats to contact local police or other law enforcement if a tax debt is not paid.
- Demands for payment by third-party or pre-paid debit cards.
Taxpayers are urged to report tax scams and identity theft schemes to FTB as soon as possible either at www.ftb.ca.gov/online/Fraud_Referral/index.shtml or by calling (800) 852-5711.
Businesses concerned about their employees’ information should contact FTB at (916) 845-7088 and select option 5.