Pittsburgh, PA – July 30, 2020 – One of the most common scams today involves callers pretending to be government officials. Some claim to be tax officials and representatives from the Social Security Administration; others claim to be law enforcement officers and threaten legal consequences. All of them use fear and intimidation to trick victims into turning over personal information or money, often in the form of gift cards.
A new investigative study by Better Business Bureau (BBB) finds that while the number of government scam reports has fluctuated, scams have become more diverse and more sophisticated. In addition, many scammers have 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.
The investigative 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.
“Government impostor scams are constantly evolving and they prey on people of all ages using manipulative fear tactics to demand payment or personal information,” says Warren King, president of the Better Business Bureau of Western PA. “Though people ages 20-59 are actually more likely to lose money to these scams, the average loss for someone over 60 is dramatically higher at $2,700 per victim.”
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. Many of these scams involve robocalls that are transferred to call centers in India when an interaction takes place.
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 throughout the U.S. 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.
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 many cases, scammers insist they are law enforcement officers and threaten to arrest people immediately if they do not pay money, usually with gift cards. 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 Pittsburgh area woman recently spoke to BBB after receiving a phone call from the “Department of Treasury” regarding claims that her Social Security number was linked to a rental car associated with various crimes in Texas. She was told that a warrant was out for her arrest for money laundering and drug smuggling and was directed to “secretly” go to her closest grocery store, where she purchased $9,000 in Target gift cards to cover fees, fines and issuing of a new Social Security number. Unfortunately, after receiving multiple follow-up phone calls impersonating “a senior officer of the United States Drug Enforcement Administration (DEA), an attorney with the Senior Division of Social Security Administration and a law enforcement officer with the Pittsburgh Bureau of Police,” she provided her gift card numbers to the scammer.
“As a college educated, former fraud investigator for Experian, I feel so stupid and can’t believe I fell for this scam,” reiterated the local victim. “I should’ve known when they refused to say what name the car was rented under, but each caller sounded so official by providing me with badge and ID numbers, along with giving me a case and warrant number to reference.”
Additionally, government impostor scams attempt to lure victims with the promise of a “free” government grant, which they claim will be awarded if the victim pays a fee with a gift card or prepaid debit card. In reality, there is no grant. Many of these attempts are made via social media.
Toward the beginning of the pandemic, a Mercer county woman reported to BBB that she lost $500 to a government grant scam on Facebook, which involved the impersonation of an agent from the Federal Bureau of Investigation (FBI). The victim stated, “One of my Facebook “friends” told me about this grant I could get and she sent me a link to talk to ‘JD Wilson,’ an FBI agent on Facebook Messenger.” She was told that if she paid $500, she would receive a grant of $50,000, but higher payment levels would result in an increase in the grant all the way up to $2,000,000, so she had to “choose wisely.”
How can you spot and avoid someone impersonating a government agency?
- The IRS generally first contacts people by mail — not by phone — about unpaid taxes. Phone calls impersonating any government agency should always be a red flag.
- Never provide your bank account or other personal information to anyone who calls you.
- Don’t pay by gift card. The IRS and other government agencies will not insist on payment using an iTunes card, gift card, prepaid debit card, money order, bitcoin or by sending cash.
- No government agency will ever request personal or financial information by email, text or any social media.
- Don’t click on links in emails or text messages.
- Social Security numbers are never “suspended.”
- Caller ID cannot be trusted to confirm that the source of the call is a government agency. Look up the phone number for the real agency and call to see if they are really trying to contact you — and why.
- The Social Security Administration will never threaten to arrest you because of an identity theft problem.
How can you 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.
- Federal Trade Commission: 877-FTC Help or ftc.gov.
- Internet Crime Complaint Center: https://www.ic3.gov/complaint/splash.aspx.
- Contact your cell phone 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.
ABOUT BBB: For more than 100 years, the Better Business Bureau has been helping people find businesses, brands and charities they can trust. In 2019, people turned to BBB more than 183 million times for BBB Business Profiles on more than 5.4 million businesses and Charity Reports on 11,000 charities, all available for free at bbb.org. There are local, independent BBBs across the United States, Canada and Mexico, including your BBB Serving Western Pennsylvania, which was founded in 1931 and serves the 28 counties of Western PA.