Check washing is so simple, you must learn to prevent check fraud
Are check fraud and check washing still relevant in the age of digital payments? If you’re like the average person, chances are you don’t write too many checks anymore. With the convenience of online payment options, nearly universal acceptance of credit and debit cards, and the proliferation of ATMs offering you easy access to money at every turn, why resort to the archaic, labor-intensive method of writing a check?
The simple answer—sometimes we have no other choice! Some places still don’t accept credit cards (Costco if you don’t have an American Express), or they charge an extra fee for them. Some retailers don’t offer online payment options. And frankly, sometimes it’s just an old habit and we haven’t made the effort to find a safer option because we’re stuck in the mindset of “it’s never happened to me” when thinking about check fraud.
Because we are distracted during tax season, we are primed to be socially engineered or manipulated by tax scams and can end up becoming the victim of tax ID theft. Here’s how to combat the problem:
When someone asks for your SSN, TIN or other ID, refuse until you verify their legitimacy.
If someone promises to drastically reduce your tax bill or speed up your tax return, suspect fraud and tax ID theft.
If anyone asks you for information in order to send you your check, they are scamming for your identity. The IRS already knows where you live (and where to send your refund).
Know that the IRS will NEVER email you for any reason. The IRS emphasizes that it doesn’t “initiate contact with taxpayers by email to request personal or financial information.” This includes “any type of electronic communications, such as text messages and social-media channels.”
Secure your computers and copy machines from hackers.
Last year, more than 80 million Americans filed their tax returns electronically and even more stored tax-related information insecurely on their computers. To prevent electronic identity theft, implement the following security measures:
Install anti-virus, anti-spam and anti-spyware software (generally referred to as a Security Suite) configured to download and install automatic updates. Failure to take this most basic and time-tested of steps allows malware attached to malicious emails, social media platforms and rogue websites to penetrate your entire system, giving thieves access to every computer on your network, not just one.
Create strong alphanumeric passwords or utilize password protection software to protect the digital keys to your information.
Encrypt hard drives or data-sensitive folders to keep out unwanted visitors.
Set up automatic operating system updates and security patches that close gaping entry points for data thieves.
Tax season can be a stressful time of year for individuals and business owners alike, especially those who fail to plan in advance and then sacrifice focus and performance as they race to meet the filing deadline. But that stress is nothing compared to the potential destruction of your financial reputation brought on by tax-time identity theft. And tax-related identity theft is on a precipitous rise.
An audit published on July 19, 2012 by the U.S. Treasury Department, found that the IRS paid fraudulent tax returns to identity thieves worth a total of $5 Billion in 2011. The study also predicted that the IRS (and therefore, you as a taxpayer) will lose an estimated $21 Billion in fraudulent claims over the next five years. Tax-related information is the Holy Grail of identity theft because it contains virtually every piece of information, including a Social Security number (SSN), which a fraudster needs to defraud you.
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