On October 12, The Internal Revenue Service (IRS) announced that there is a new cyber scam to be aware of. The scam is an intricate plan that has affected both tax pros and taxpayers alike, and is being used by cybercriminals to obtain access to annuity and life insurance accounts.
Although there may be other iterations of the scam, it is one that can be relatively easily avoided if one knows what to look for. Essentially, the scam is carried out by a cybercriminal who impersonates a cloud-based storage provider in order to lure a tax professional into responding to a phishing email. The unsuspecting tax professional is typically instructed to provide their email credentials, including username and password. With this information, the cybercriminal utilizes the tax specialist's email account to impersonate them, steal client email addresses, and spam them with emails containing fake IRS insurance forms. The cybercriminal, posing as the tax professional, will ask the client to complete and return the attached forms - typically receiving client replies by fax, an email through a different service provider, or an email that is nearly identical to the tax professional's . According to the IRS.gov website, the text of the email typically states:
"Dear Life Insurance Policy Owner,
Kindly fill the form attached for your Life insurance or Annuity contract details and fax back to us for processing in order to avoid multiple (sic) tax bill (sic)."
Once a cybercriminal receives the completed insurance tax forms, they use the data to contact the client's insurance company in order to obtain a loan, or make a withdrawal from client accounts.
It is important to be aware of current cyber scams to avoid becoming a victim. Always be skeptical of where emails are coming from, and try to make a habit of confirming sensitive requests with the party requesting the information. This confirmation can be as simple as reaching out to your tax professional/service organization by phone to ensure that the request is in fact legitimate, and can save you from unnecessary headaches in the future.
The IRS asks that tax professionals who have data breaches contact them immediately through their Stakeholder Liaison, and are asking individuals who receive the insurance tax form scam email to forward it to email@example.com and then delete it. Individuals who completed and returned fake forms are directed to contact their insurance carrier for assistance.
You're Invited! Annual Not-For-Profit Accounting Update
Thursday, September 26, 2019
Hosted at Detroit Historical Museum
Middle Market Manufacturing Outlook
Wednesday, October 23
Hosted at the Detriot Athletic Club
7:30 AM - 11:30 AM