New CRA Scams are Being Invented Daily

Summer 2016 DFK Newsletter Article

Author: Adrienne Barclay CPA, CA, CPA (New Hampshire), Tax Manager, Taylor Leibow LLP

The latest scam that the Canada Revenue Agency (“CRA”) is warning the public against involves the use of iTunes gift cards to pay a fictitious tax balance.

There have been many victims of fraudsters convincing them that they owe back taxes and advising them that in order to avoid RCMP officers arresting them, they should purchase iTunes gift cards. They claim that the victim owes “back taxes” as a result of an audit and that an arrest warrant can be avoided if payment is made promptly. The victim is instructed to purchase and activate iTunes gift cards and provide the codes to the fraudsters, allowing them to drain the gift cards of their balances.

There have been many victims of fraudsters convincing them that they owe back taxes and advising them that in order to avoid RCMP officers arresting them, they should purchase iTunes gift cards. They claim that the victim owes “back taxes” as a result of an audit and that an arrest warrant can be avoided if payment is made promptly. The victim is instructed to purchase and activate iTunes gift cards and provide the codes to the fraudsters, allowing them to drain the gift cards of their balances.The fraudsters in this scam are very convincing by calling or texting your personal phone and identifying themselves as CRA employees and providing the victim with their employee number.

The fraudsters in this scam are very convincing by calling or texting your personal phone and identifying themselves as CRA employees and providing the victim with their employee number.
There is little recourse for these victims to get their money back. Credit card companies have said they cannot help as the original purchase was from a legitimate business. Apple has advised that the iTunes gift cards are drained of their funds immediately. The police have been able to track the iTunes gift card redemptions to accounts in China.Police are actively investigating this current scam and say it has become so widespread that all across Canada they are receiving thousands of calls about similar scams. In addition, the Canadian Anti-Fraud Centre reports that to date they have received 46 complaints involving the iTunes gift cards with total losses of $85,041.

Police are actively investigating this current scam and say it has become so widespread that all across Canada they are receiving thousands of calls about similar scams. In addition, the Canadian Anti-Fraud Centre reports that to date they have received 46 complaints involving the iTunes gift cards with total losses of $85,041.It is important to keep in mind that the CRA will never ask a taxpayer to give personal information of any kind by email, text message, or by clicking on a link. Nor will they ever ask for a tax balance to be paid through the use of any form of pre-paid credit card. In addition, the CRA will never threaten to lay criminal charges or have anyone put in jail if taxes are not paid.

It is important to keep in mind that the CRA will never ask a taxpayer to give personal information of any kind by email, text message, or by clicking on a link. Nor will they ever ask for a tax balance to be paid through the use of any form of pre-paid credit card. In addition, the CRA will never threaten to lay criminal charges or have anyone put in jail if taxes are not paid. If you receive an unexpected call from a “CRA representative” you should ask for the name and employee number plus a

If you receive an unexpected call from a “CRA representative” you should ask for the name and employee number plus a callback number. You can then call the CRA at their general line at 1-800-959-8281 to confirm whether you owe back taxes and to confirm the legitimacy of the CRA representative’s request.

There are many known scams, pitches and fraud types, with new ones being invented daily. Beware of any unexpected communication from the CRA so you don’t become a victim too.

Thanks!

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