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Cyber Risks · Krebs on Security

Phony Tax Refunds: A Cash Cow for Everyone

Summary: Identity thieves filed a phony $7,700 tax refund in the name of Joe Garrett, Alabama's deputy tax commissioner, and the money passed through more than a half dozen U.S. companies that each took a slice, including banks, payment processors, tax preparation firms and Amazon. The refund moved from the U.S. Treasury to an account at Sunrise Banks of St. Paul, Minn. controlled by Santa Barbara Tax Products Group, which extracted $35 for handling the federal refund, $10 for state refunds and $10 for TurboTax, while $2,000 was diverted to an Amazon gift card and the rest went to a Rush Card prepaid debit card.

What you should know: Commissioner Julie Magee said five different financial institutions touched the fraudulent refund filed in her deputy's name before it reached the thieves, and TPG alone processed roughly $32 billion in refunds for about 11 million filers in the most recent season. Every intermediary in that chain collects a fee whether the return is real or stolen.

Read the original at Krebs on Security ↗

Topics
Fraud & Scams
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