The press and the ATO have been loud and clear over the course of 2018 warning about scams involving fake ATO representatives. These scammers have contacted both taxpayers and tax agents alike from businesses in Australia demanding that debts be paid. Some have been aggressive. Threats have been made. In light of the increased activity from scammers, it’s in your best interest to be extra vigilant when contacted by email or phone from persons claiming to represent the tax office.

Fake Calls & Emails Challenged Thousands in 2018

After all, these impersonators claimed $830,000 in losses in November 2018 alone. The ATO said that 4000 reports were made of scam phone calls in July 2018. By November 2018, that number rose to 27,000. The aggressive and heightened efforts from scammers have appeared to accompany increasingly sophisticated means of resembling actual ATO agents when sending messages demanding that debts be paid.

It seems that almost month-by-month scammers are not only becoming steadily more adept at creating a façade over the phone and email that is capable of duping people, but are also using intimidation and fear to squeeze money out of taxpayers.

In July 2018, a fake email deceived hundreds. The scammers informed the recipients of the email that their credit/debit details were incorrectly stored on the ATO system. Recipients were directed to a well-designed fake site or fake ATO ‘Office Portal’ or ‘Gateway Portal’. Once there, you entered your personal and banking details and gave away credit card numbers, credit limits, and address information to the scammers.

In September 2018, the scammers upped their game. The impersonators were now calling you, enticing you into a 3-way conversation with a fake ATO agent and a fake representative of your accountant or tax agent. The fake ATO agent and fake tax representative would then inform you that you had not paid your tax debt in full. Badgered and sometimes threatened with arrest, you would then be pressured into making a payment into a given account, often immediately.

Here is an example of such a scam from the ATO website (wherein the actual names have been changed):

A scammer left a voicemail for Darren, advising they were from the ATO and that Darren would go to jail for five years if he did not contact the ATO due to an outstanding debt. Darren called back on the number provided and was advised to make a payment of $9,000 straight away, as the federal police had been assigned to the case and he would go to jail for five years if the debt wasn’t settled today. Darren provided the scammer with his tax agent's number who was supposedly then dialed in by the scammer via a three-way conference call. A man by the name of Michael Grey answered claiming he was from the same practice as Darren’s tax agent. ‘Mr. Grey’ said that Darren’s tax agent was in a meeting and not available. A fake conversation was had between Mr. Grey and the original scammer with Mr. Grey agreeing there was an error with Darren’s tax return and that he owed money to the ATO. Mr. Grey told Darren to go to a specific location and pay the $9,000 today. Darren withdrew cash and deposited it into a Bitcoin machine.

By November 2018 and heading into this year, the scammers have become even more confident and sophisticated. Software is being employed to make the impersonator’s phone number appear to be a real ATO phone number. It may then appear on caller ID or voice mail, or you may then be directed by *69 for call back functionality.

How to protect yourself in 2019

Scams work because scammers are convincing. If you haven’t been a target then you might be tempted to scoff at this, but $830,000 worth of money lost to these scammers over the last year is nothing to scoff at. It is easy to be thrown by a phone call and email when you have been busy with sales, compliance, R&D, and other business. The reasons these impersonators have had success is that they use software to make their phone numbers, emails, logins, and conversations match those of the official tax office as closely as possible. And the threat of tax audit penalties or court action, often completely out of the blue, can shake up even the most resilient and cautious taxpayers.

But there are common ways in which these fake ATO agents differ from the real deal. Knowing these differences can help you identify a scam caller or email.

  • Scammers will tell you that you are committing tax fraud, a complaint has made against you, or declare a debt, and it’s the first time you’ve heard about it.
  • Scammers will often demand immediate payment, often through less than usual payment methods such as iTunes, Bitcoin cryptocurrency, store gift cards or pre-paid visa cards. The ATO does not use these methods and never demands immediate payment.
  • Scammers will often resort to bullying, demanding that you pay up without allowing you to ask questions about their legitimacy or the nature of your supposed debt. They may even threaten you with arrest or court action. Again, the ATO will never resort to such tactics.
  • Scammers will often try keep you on the line until you commit to pay or send them the information they need. They don’t like it if you wish to consult with your tax advisor or seek further advice.
  • Both phone and email scammers will offer tax refunds or perhaps simply ask for an update on your tax info, but you will need to do so by providing personal credit card information. They do this to steal money using this info. The ATO will not offer refunds to credit cards.

If you have received a call from a scammer or a suspected scammer, or even a call or email that seems even slightly suspicious, then these are the steps to ensure you are not conned out of your money.

  1. Do not immediately act on the call or email or follow the caller’s or sender’s instructions.
  2. Be guarded on the phone and by email – do not freely give away personal information unless you have verified the recipient, do not share such information on social media, and do not click on links, download files, open attachments, or upload information until you have followed the below steps.
  3. Discuss the call or email with your tax accountant or a reputable, experienced tax and business advisory team
  4. Log in to myGov to check the status of your tax affairs, or call your tax accountant or the ATO for clarification about your debts.
  5. Be mindful that the genuine ATO only accepts certain payment methods such as Bpay (the ATO biller code has always been 75556) or cheque paid at the post office. To check that a payment method is legitimate, visit ato.gov.au/howtopay

Verification is key. No matter how officious, demanding, or even threatening the person may be, do not make payments until you have taken the time to verify that you are actually paying a specific tax office debt or updating information to a legitimate site or portal. Remember, when paying any tax office debt you need to indicate the type of tax the payment is for (such as income tax or an integrated client account). Talk to friends and family and people you trust. Have they received similar phone calls or emails?

Wish to make it as simple as possible? If you are unsure whether or not a call or email purporting to be from the ATO is genuine, hang up and phone the ATO on 1800 008 540 to check if the call was legitimate or to report a perceived scam.

If you are concerned about these ATO impersonators, or believe you might have been impacted by a scam, then Calibre Business Advisory can assist. We work closely with the ATO, and routinely keep up to date on the latest techniques of scammers. Moreover, we provide CFO-level support that you can outsource from us, which can not only help you deal with such scams, but also plan a more effective tax, business and compliance strategy overall.

Important Disclaimer: Readers should not act solely on the basis of the material on this page. Items herein are general comments only and do not constitute or convey advice. Legislation and proposals of legislation are also subject to constant change. We therefore recommend that formal advice be sought before acting in any of the areas. This news article is issued as a guide to the readers. Calibre Business Advisory Pty Ltd and its associated entities disclaims any losses that may be incurred as a result of the reader undertaking any action based on this article.

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