As the holiday season passes and tax season ramps up, there are new concerns to be aware of when it comes to fraud. While you are gathering financial documents and filing returns, it’s important to be mindful of how you share your information. Don’t let your guard down just because you’re done shopping and gift-giving.
As a VyStar member, it's crucial to take proactive steps to safeguard your finances and avoid the potential dangers of fraud during tax season. We’ll go over some helpful tips and concerning red flags that will help keep your finances safe in the first few months of the new year.
Phishing and Smishing Scams
Phishing and smishing scams continue to be a significant threat during tax season, and fraudsters are getting more sophisticated in their tactics. One popular scheme involves sending phishing links, often disguised as official communications from trusted entities like TurboTax. These messages may claim that your tax return has been "rerouted," prompting you to click on a link that redirects you to a fraudulent site. The goal is to trick you into entering your routing and account information.
VyStar has multiple safeguards in place to prevent those types of situations, but members are advised to be highly skeptical of unexpected emails and text messages, especially those claiming to be from tax preparation services. It is important to independently verify the legitimacy of such communications before clicking on any links.
We are always here to help, but we want to empower our members to protect themselves against scams as much as possible. If you give out security details like your Social Security number, mother’s maiden name or any number of other personal information, it’s much easier for criminals to take your money.
Gift Card Payments and Fraudulent Requests
It's essential to remember that the IRS, government agencies and legitimate businesses do not accept payments in the form of gift cards. Fraudsters often attempt to deceive individuals by posing as official entities and demanding payment through gift cards. VyStar members should be wary of any such requests and to validate the authenticity of the communication through official channels before taking any action.
Identity Theft
Tax season is a prime time for identity thieves. They may use stolen information to file fraudulent tax returns, claiming refunds that rightfully belong to someone else. It’s best to regularly monitor your financial accounts for any suspicious activity and promptly report any discrepancies by reaching out to VyStar as soon as possible.
Additionally, consider placing a fraud alert or credit freeze on your credit reports to add an extra layer of protection against unauthorized access. At VyStar, we make it easy to manage alerts in Online & Mobile Banking. There are a variety to choose from, including Balance Alerts, Transaction Alerts, Certificate Maturity Alerts and Loan Due Date Alerts.
Fake Tax Preparation Services
Be wary of fraudulent tax preparation services that promise unrealistically high refunds or charge exorbitant fees. Some scammers pose as tax professionals, exploiting individuals seeking assistance with their tax returns.
Before engaging any tax preparation service, research their credentials, check for reviews and ensure they are registered with the IRS. There are some easy ways to identify whether or not someone is connected to the IRS or not. And only take recommendations from trusted sources, and never blindly agree to something you read online.
Protecting Personal Information
Guarding your personal information is crucial in preventing tax season fraud. Use secure methods to transmit sensitive documents, such as tax forms and avoid sharing personal details over unsecured Wi-Fi networks.
During tax season, it’s especially smart to use strong, unique passwords for financial accounts and enable two-factor authentication whenever possible. Regularly update passwords and be cautious when accessing financial information in public spaces.
Stay Informed
Knowledge is your best defense against fraud. Stay informed about the latest scams and fraud trends by regularly checking reputable sources like the IRS website or consulting with VyStar, whether that’s in person at your nearest branch or remotely by calling the Contact Center or utilizing VyChat.
New scams pop up all the time, like a trend in 2023 where fraudsters try to get you to send them some of the vital information they need to take advantage of you. People are also falling for a W-2 scheme that may not be on everyone’s radar. And while COVID-19 is not as prevalent as it was a few years ago, scammers are still taking advantage of the deadly virus when it comes to your finances.
The more aware you are, the better equipped you'll be to recognize and avoid potential threats.
Reporting Fraud
All the dollars and cents fraudulently taken from people add up each year. The Federal Trade Commission reports fraud cost consumers $8.8 billion in 2022, which was up 44% from the year before. Imposter scams topped the list of most common scams in 2022, according to the FTC, totaling $2.6 billion in costs to victims compared to $2.4 billion in 2021.
The FTC offers a helpful guide if you’re trying to figure out what is covered or protected at the government level. You can even reach out to the Office of the Inspector General over the phone or via email if the details are unclear.
The Bottom Line
As tax season unfolds, it's crucial to remain vigilant against fraudsters seeking to exploit unsuspecting individuals. By following the tips we provided, including being cautious of gift card payment requests and recognizing the dangers of phishing links, you can protect your finances and enjoy a worry-free tax season. Remember, a proactive approach to security is the key to a safe and secure financial future. We are always here to help. Please reach out if you have any questions.