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While it is important to protect yourself and your business from cyber fraud year-round, tax-time scams pose a particular danger. This is because the end of the financial year brings a flurry of activity that scammers seek to exploit. Businesses have to finalise invoices, engage with their accountants, and store and share lots of personal and financial information. Knowing this, fraudsters are out to steal your money, data or personal information through online threats and sophisticated scams. For these crooks, ‘tax time is like Christmas’. But don’t worry: with Cybertrace’s help, you can fight back, protect your business and ensure cyber criminals get nothing but a lump of coal under their digital tree. Learn how to protect your business and what you can do even if they defrauded you already (hint: a lot!). But first, let’s look at the most common tax-time scams.

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Fake Provider Phishing Scam

There are a range of fake provider phishing scams out there seeking to defraud businesses and individuals.  Like other tax-time scams, the fraudsters are out for two things: your money and your personal information. For example, the Australian Taxation Office (ATO) warned in April that scammers offer, for a fee, to obtain tax file numbers (TFN) and Australian business numbers (ABN) on behalf of businesses and individuals. Instead of doing this, however, they simply steal their victims’ money as well as the personal information provided. This information is then used to access restricted data and/or funds, set up fake identities and perpetrate further fraud. To protect yourself from these scammers, make sure to apply for TFNs and ABNs yourself (it’s free!). If that’s not an option, at least independently verify the bona fides of any service provider you use.

During tax time, fraudsters are also pretending to be tax agents offering to lodge tax returns on your behalf. Sneakily, they pretend to have to do so through your MyGov account for which they will request login details. Needless to say, as soon as they have access, the scammers will steal whatever personal data they can find. In addition, they will make off with any “fee” you have paid them for their non-existent service. To avoid tax-time scams, always independently verify that anyone you deal with is registered with the official Tax Practitioners Board. Also, never share your MyGov password with anyone and set up additional security code authentication via your mobile.

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Fake Invoice Scams (Business Email Compromise Scam)

Another common business scam that fraudsters increasingly deploy at tax time is a fake invoice (or business email compromise) scam. In this con, cyber criminals send bogus invoices from professionally designed but fake email addresses and websites. In doing so, they seek to impersonate genuine companies, such as suppliers. During the hectic end of the financial year, stressed employees might miss the almost imperceptible details that signal a scam. This might be a slightly different email address/website, a new bank account or novel contact details. With these small but crucial details falling under the radar, tax-time scammers make off with the proceeds of their fake invoice. Fake invoice scams are surprisingly common and account for almost two thirds of all business losses reported to ScamWatch. Even worse, the average loss is nearly $30,000. Protect yourself by double-checking each invoice’s email address and account details against your previous records.

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Ransomware Scam

An ever-present year-round threat, ransomware attacks also typically increase around tax time. According to the Australian Cyber Security Centre, ransomware is a type of malicious software (malware) that makes computer files unusable. Cybercriminals use it to deny you access to your files or devices and then demand a ransom to restore access. Ransomware is usually installed covertly via compromising links or email attachments which proliferate during tax time. To protect yourself, make sure you install security software updates, and never click on suspicious links or open doubtful attachments. In addition, make sure to back up the data on all your devices regularly. If the cybercriminals get you nonetheless, do not pay the ransom – there is no guarantee you will actually regain access. Instead, restore your files from backup to beat this tax-time scam.

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ATO Impersonation Scam

The most important tax-time scam Cybertrace’s expert analysts are warning about is fraudsters impersonating the Australian Taxation Office (ATO). Using fake emails, texts, or automated phone messages (robocalls), scammers deploy highly emotive threats (“serious debt”/”impending arrest”) or baits (“unexpected refunds or loans”). Their aim is to get you to click on embedded links or call “official” numbers they provide. This enables them to use fake-but-official-looking forms to steal your personal identifying information with which they then perpetrate further fraud. Alternatively, they use their considerable persuasion skills to scare you into paying a fake “debt” via iTunes cards, gift cards or bitcoin. Protect yourself by always using MyGov (with strong security settings) to check for any tax-related messages from the ATO. Since the ATO won’t communicate with you via email/text, don’t click on embedded links and verify all senders. Finally, never pay tax debt with iTunes cards, gift cards or bitcoin!

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Additional Anti-Scam Protection for Your Business

You don’t ever want to find yourself in a situation where you realise that the tax-time scammers got you! Fortunately, there are lots of things you can do to protect your business, at tax time and year-round. When receiving any communication purported to come from the ATO (or your bank!), make sure you don’t click on any links or buttons. Instead, go directly to MyGov (or your bank’s internet banking login page), as you normally would. Likewise, make sure to use anti-virus protection and be careful when any website is prompting you to download unknown software. Finally, make sure that your filing, purchasing, and accounting systems are well-organised. That means limiting the number of people with the authority to buy/order, calling any suppliers whose bank details appear to have changed and, if anything feels suspicious, independently verifying the business’s details.

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What if I already lost money to a tax-time scam?

Despite your best precautions, scammers will sometimes breach your defences and wreak havoc. They run a sophisticated operation, are highly persuasive and produce fakes that are very hard to spot. If fraud happens, it is normal for victims to feel angry, embarrassed or at their wits’ end. Don’t blame yourself! Losing thousands and thousands of dollars to a tax-time scam is devastating for any business. Thankfully, with Cybertrace by your side you can turn the tables on these crooks. Cybertrace offers a range of high-quality investigative tools, including forensic website analysis, cryptocurrency tracing and social engineering to obtain intelligence. Contact our experienced investigators today to find out how we can help you.

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