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Money May 2016

Dollar Sense

Potpourri: Several Ways Thieves Use Your Phone Against You and What to Do About It

By Teresa Ambord

Suppose the call says “press one to prevent future calls” or “text NO to opt out of future text.’” Don’t be fooled. If you follow their directions, you are confirming that your phone number is active and the problem will likely get much worse.

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A thief wants your smartphone like he or she wants your wallet. And depending on what’s in your phone, it may be worth a great deal more, like your bank account and credit card logins. Thieves are hoping you have stored this information in your phone.

What You Should Know to Defend Against Phone Scams

Phone scams have been around much longer than computer scams. And lately…they’re growing in number and boldness. That might be because thieves have figured out that while some people, especially the elderly, have resisted computers, most everyone has a phone. Even if you recognize that the call telling you that you’ve won a great prize (like a free cruise) is a scam, thieves aren’t done with you. There’s a strong chance the call will include a way to opt out of receiving future calls (or texts or emails). But be aware, they have no intention of letting you opt out. Suppose the call says “press one to prevent future calls” or “text NO to opt out of future text.’” Don’t be fooled. If you follow their directions, you are confirming that your phone number is active and the problem will likely get much worse.

Better to simply hang up rather than follow any instructions or answer questions. Naturally you’ll want to scream at the caller, but security experts say, just disconnect the call. If you get a suspicious text forward it to “SPAM” on your phone, and then delete the original.

Also, if your phone has anti-malware software keep it updated.

 

One-Ring Calls (or calls that Disconnect When You Answer)

Have you gotten the one-ring call? It’s just what it sounds like. The phone rings once, then disconnects, or disconnects when you pick up. What’s the point? Thieves are counting on your curiosity to cause you to call back. If you do, the return call could cost you more than you think, perhaps $30 or more.

Often these calls originate in other countries, so just calling to find out who called you is expensive. In addition:

  • The caller may draw out the charge by putting you on long holds, and
  • You may even get slapped with usage fees.

What to watch for: If your phone rings once or if an unfamiliar area code rings, don’t answer. Here’s a list of area codes that have become problematic: 268, 284, 473, 649, 664, 767, 809, 829, 849, 876. Jot them down and keep the list handy, and be aware… more will probably crop up.

 

Old-Fashioned Phone Theft

Believe it or not, theft of your smartphone is considered old-fashioned these days. A thief wants your smartphone like he or she wants your wallet. And depending on what’s in your phone, it may be worth a great deal more, like your bank account and credit card logins. Thieves are hoping you have stored this information in your phone. The obvious advice from the experts is, don’t.

Also, regardless of what is stored in your phone, use a strong password. If remembering a strong password is hard for you, here’s a trick recommended by security experts:

  • Think of a line from a favorite song or poem or nursery rhyme.
  • Use the first letter of each word. For example, “Mary had a little lamb, ” becomes “Mhall.”
  • Add a number that is meaningful to you, like your mother’s birth year.
  • You may be required to add a character, such as $ or #.

Of course, for years now, smartphone users have had the ability to wipe their phones clean of data, remotely. Now more manufacturers are installing a kill switch, which you can use to turn your stolen phone into a useless brick, remotely. That makes phone stealing less attractive to thieves who plan to sell them overseas. Millions of phones are still stolen every year, but Consumer Reports (CR) says the numbers are dropping, because of these security devices.

CR also says, however, that less than half of mobile phone users protect their phones with the built-in security. Don’t be that person!

 

The Fake IRS Call

I got my first fake IRS call this week. It was only a matter of time, since even the IRS Commissioner says he’s gotten the calls, so if you haven’t, you probably will. They are being reported in every nook and cranny in the country.

My call was of the disjointed, mechanical voice variety. Here’s exactly what it said (with the badge and phone numbers taken out).

I am Tracey Bradshaw calling you from Criminal Investigation with federal badge number (reads numbers). The issue on hand is extremely time sensitive and urgent, as after audit, we found that there is fraud and misconduct on your tax file, which needs to be rectified immediately. So to return the call as you see this message on direct line to my senior (lists phone number) I repeat (phone number).

I was an accountant and tax practitioner for many years and an enrolled agent with the IRS. Yet, I admit, I had to think about this for a moment. I assumed it was fake, but I listened a couple of times, just in case. The message instructed me to return their call, and gave me a number. Instead of calling it, I typed the number into Google. Instantly at least 15 messages popped up, from people who’d received the same call from that number. One person said he’d received these calls several years in a row.

Another had no income apart from Social Security, so she doesn’t even file returns, yet the message accused her of tax filing fraud.

Clearly, this is a shotgun approach… as in “Let’s throw out the phishing line and see who we snag.” I suspect that anyone who returns the call will be told he/she owes money, but the generous IRS is willing to close the case if the caller gets a prepaid debit card and pays them a specified amount.

 

Live Calls

While robotic calls (robocalls) are increasing, IRS Commissioner, John Koskinen, warns of calls that are live. “These schemes continue to adapt and evolve in an attempt to catch people off guard just as they are preparing their tax returns. Do not be fooled. The IRS will not be calling you out of the blue asking you to verify your personal tax information or aggressively threatening you to make an immediate payment.”

Since October 2013 nearly 900,000 such calls have been reported to the IRS, and of course many, many more were not reported. According to the IRS, more than 5, 000 known victims have paid $26.5 million to the scammers. In addition to the phone scams, similar scams by email have ramped up 400% so far in 2016. They can occur any time during the year, but seem to increase more during and right after tax season, when people are likely to be doing business with the IRS.

That’s why the IRS wants you to know, it positively will not:

  • Call you to demand an immediate payment.
  • Ask you to verify personal and financial information.
  • Demand that you pay tax immediately.
  • Require you to use a method such as a prepaid debit card to pay your taxes.
  • Ask for your credit or debit card numbers over the phone, or
  • Threaten you with immediate arrest by your local police.

 

Here’s what the IRS tells you to do to protect yourself from phone scammers.

  1. Do not give personal information over the phone.
  2. If you suspect a scam, call TIGTA (which stands for the Treasury Inspector General of the United States) at 800-366-4484 and report it, or
  3. Log onto www.ftc.gov, and use the FTC Complaint Assistant to report the scam.

 

Phone Trivia: Did You Know?

If you hate being put “on hold” while on a phone call, you can thank Alexander Graham Bell, at least according to some sources. The use of “hold” originated when Bell turned to Mr. Watson, handed him his telephone instrument and said “here, hold this.”

Also, if Bell had had his way, the standard greeting when answering a phone call would be, “Ahoy.” It was Thomas Edison who later overruled that by suggesting a greeting of “hello” instead.

 

Teresa Ambord is a former accountant and Enrolled Agent with the IRS. Now she writes full time from her home, mostly for business, and about family when the inspiration strikes.

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