Alert: W-2 Phishing Scammers Targeting Not-for-Profits
- Mar 24, 2017
The Internal Revenue Service has issued an alert regarding a scam from last year that targeted companies and this year is setting its sights on schools and not-for-profits.
Here’s how the scam works: Bad actors send an email to staff in the organization’s accounting or human resources department that appears to come from the executive director or other leader. The email requests a list of employees, their W-2 forms, earnings summary, and employees’ personal details such as Social Security numbers, home addresses and salaries.
The fraudsters then take this information and use it to file fraudulent 1040s in order to receive tax refunds. These scammers, posing as the not-for-profit’s leader, will then often direct an accounting employee at the organization to initiate a wire transfer under the guise of covering payroll.
There are several things not-for-profits can do when it comes to this type of cyber fraud:
- Send any suspected bogus W-2 emails to email@example.com. (Place “W2 Scam” in the subject line.)
- If you become a victim, file a complaint with the FBI’s Internet Crime Complaint Center at www.ic3.gov.
- Alert the state tax agencies by notifying StateAlert@taxadmin.org
- Employers should share information with their payroll, finance, and human resource employees about these W-2 and wire transfer scams.
- Employers should have a policy on distributing employee W-2 information and conducting wire transfers.
- Employees should file a Form 14039, Identity Theft Affidavit, if the employee’s tax return is rejected because of a duplicate Social Security number
- Confirm requests for large amounts of personal data with the email sender.
- Employees whose form W-2s have been stolen should review the recommended actions by the Federal Trade Commission at www.identitytheft.gov or the IRS at www.irs.gov/identitytheft.
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Amy E. MacFadyen
Amy MacFadyen is a Partner in the firm’s Not-for-Profit Services Group and Audit Department with ten years of experience in public accounting, where she has specialized in not-for-profit and commercial auditing.
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