December 2018

Earlier this year, we reported on the Australian Tax Office’s (ATO) warning regarding malicious phone scams. In July, over 4,000 such calls had been reported. In November, this number sky rocketed to 27,000. With estimate losses reaching $830,000 in November alone, it’s clear the threat from the swindle has not subsided.

The scam first came to attention when the ATO issued a warning in March of this year. The methods of deceit and trickery have evolved since then. With each passing month, accounting professionals have observed that the scams are becoming more sophisticated. As of early December, more than 170 taxpayers have been scammed. 

Delia Rickard, deputy chair of the ACCC, the body behind Scamwatch, said she had never seen a series of scams as prolific as these, describing the situation as berserk.

Scammers are using automated messages to threaten taxpayers with arrests due to outstanding tax debts, some being called multiple times. Stacey Price, the founder of Healthy Business Finances, told the Sydney Morning Herald that one client had reported to her that they had received a call – twice in a single week.

The scam, which appears to have been ramped up in the last month, involves an automated phone call with a robotic voice recording demanding the victim call back or else.

"If we don't hear from you, we have to issue an arrest warrant under your name and get you arrested,” says the recording.

Those who return the call are asked to provide payments for ‘tax debts’ in the form of pre-paid credit cards or gift cards like iTunes or Google. Other forms of payments requested have included money transfers via Bitcoin ATMs.

Several other scams have also been reported. These include people pretending to be from the ATO. The calls showed a fake local Australian phone number giving a sense of legitimacy, where in reality they are coming from an overseas call centre.

The scammers use software to fake legitimate phone numbers, before threatening jail or deportation if the victim does not comply.

These dodgy phone calls are difficult to regulate because they often originate from overseas. However, the ATO is urging taxpayers to report the phone number if they receive one of these calls to aid their investigation.

"The reason we ask the community to advise if there was a number on [calling line identification] is so that we can pick up new scammer approaches," an ATO spokesperson said.

The ATO has released several warnings that include common traits to help the recipient to identify if the call being received is a scam.

Firstly, the ATO has never and will never request payments for debts in the form of gift cards, prepaid credit cards, or cryptocurrencies. The only form of payments the ATO will request are transfers of direct credits to bank accounts with either a BSB number of 092-009 or 093-003, reports 9news.

Additionally, “The ATO does not project our numbers using caller ID," said Kath Anderson, the ATO Assistant Commissioner. If there is a number displayed in your caller ID you can be confident that it isn’t the ATO calling she continued. 

Moreover, Scamwatch says the ATO will never threaten anyone with arrest, or demand immediate payment of a tax debt or fine, especially through unusual payment methods such as those listed in the scams.

Additional tell-tale signs of scams can also be easily observed. Anderson said the ATO would not:

  • Use aggressive behaviour, threatening individuals with jail time or deportation;
  • Request a fee for the release a refund you are owed; or
  • Send a link via SMS or email which requires you to download or open a file; or provide personal details like login or financial information.



         Chartered Accountants

Tax Institure