One of the most common scams in the U.S. and Canada today involves callers pretending to be government officials. All the scams use fear and intimidation to trick victims into turning over personal information or money, often in the form of gift cards, according to a news release from the Better Business Bureau (BBB.)
A new investigative study by the BBB finds that scams have become more diverse and more sophisticated. The study — Government Impostor Scams: Reports Decrease, Scammers Pivot for New Opportunities, BBB Study Reveals — highlights the risk of this common but costly fraud. Read the full study at bbb.org/fakegov.
Some scammers claim to be tax officials and representatives from the Social Security Administration. Others claim to be law enforcement officers and threaten legal consequences.
Many scammers have also taken advantage of the coronavirus (COVID-19) pandemic by posing as Centers for Disease Control and Prevention (CDC) officials, Internal Revenue Service representatives who can expedite economic impact payments or contact tracers employed with local government agencies.
A recent AARP survey found that 44% of people in the U.S. have been contacted by one of these impersonators. Law enforcement officials have received hundreds of thousands of complaints. Complaints to the Federal Trade Commission (FTC) report $450 million in losses since 2015.
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Many of these scams involve robocalls that are transferred to call centers in India when an interaction takes place.
“Government impostor scams are constantly evolving, and they prey on people with threats of being arrested if money is not paid or personal information provided,” said Janet Robb, BBB Arkansas president and chief executive officer. “Consumers need to know how to recognize and avoid upsetting and costly fraud.”
In 2019, BBB reports received about scammers impersonating tax officials and claiming back taxes were owed dropped sharply while reports about Social Security Administration (SSA) impersonators quadrupled in the U.S. Complaints about fake calls from Service Canada likewise have increased in the first six months of 2020.
In many cases, scammers insist they are law enforcement officers and threaten to arrest people immediately if they do not pay money. They may tell consumers their Social Security number has been associated with a crime or may threaten to deport recent immigrants or arrest people for missing jury duty.
A Little Rock woman told BBB in June 2020 that her grandmother was called by someone in New York claiming that her Social Security number was being suspended. The woman wasn’t in the room at first but when she heard her grandmother give someone the last 4 digits of her social and her zip code, she ran into the room. When her grandmother asked the caller to repeat what the call was about, he said the Social Security Administration was suspending her social due to it being used in two “drug houses” in Texas and that there were warrants out for her arrest. The granddaughter realized this was a scam and hung up. The caller later attempted to call back from a different number.
Impostor calls from India must first go through a “gateway carrier” in the U.S. These carriers often provide both “spoofed” phone numbers that appear on caller ID and return phone call numbers for voicemails that appear to go to locations in the U.S. or Canada. The Department of Justice recently sued two of these carriers while the FTC and Federal Communication Commission issued warning letters to others. As a result, robocalls and individual calls coming from India have declined drastically over the last several months.
Other law enforcement efforts in the U.S. have led to the arrest of dozens of Indian nationals for laundering money related to these scams. However, the study notes that cases are rarely prosecuted in India.
The report recommends:
• Efforts to prevent fraud calls to the U.S. and Canada have shown promising results, and the telecom industry should continue efforts to stop illegal calls and to end caller ID spoofing. Legislation may be needed to address the problem of gateway carriers.
• The government of India should do more to prosecute and extradite those operating frauds from that country.
• Law enforcement should continue to take action against scammers who are physically present in the U.S. and Canada.
• Efforts by many retailers and banks to question people buying gift cards have had limited success in stopping the purchase of gift cards to pay scammers. The gift card industry and retailers should explore additional ways to stem fraudulent use of their products.
How to complain about government impostor scams:
• IRS: The Internal Revenue Service advises people to fill out the “IRS Impersonation Scam” form on the Treasury Inspector General for Tax Impersonation’s website, tigta.gov, or call TIGTA at 1-800-366-4484.
• Social Security: The Office of the Inspector General, Social Security Administration (SSA IG) has its own online form to take complaints about frauds impersonating the SSA.
• Canadian Anti-Fraud Centre: In Canada, contact CAFC about all government impersonation scams at 1-888-495-8501 or online.
• Federal Trade Commission: 877-FTC Help or ftc.gov.
• Internet Crime Complaint Center: https://www.ic3.gov/complaint/splash.aspx.
• Contact your cellphone carrier, which may offer free services such as scam call identification and blocking, ID monitoring, a second phone number to give out to businesses so you can use your main number for close friends or a new number if you get too many spam calls.
• File a report with BBB Scam Tracker.
Details: bbb.org.