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HMRC Scams: Shutting out the Fraudsters

HMRC Scams: Shutting out the Fraudsters

Scammers and the scams they employ evolve with changing attitudes, technology and their knowledge of the processes applied to bring them to justice. Many legitimate businesses are mimicked by these fraudsters, who even clone login pages for legitimate websites in order to gather customer usernames and passwords.

HMRC scams continue to be one of the most frequently reported types of scam impacting UK consumers. The levels of professionalism and detail applied in developing these scams is often staggering. Many consumers have reported receiving emails containing their personal information, displaying the HMRC logo and displaying a ‘spoof’ HMRC contact number which appears official when checked on a web browser.  

These scams also extend to telephone calls to consumers, advising of underpayment of income tax, large bills and threats of warrants for payment and potential imprisonment.

Three common types of scam in relation to HMRC are –

‘Phishing’ Scams – Where the fraudster uses purportedly legitimate or official methods to gather information from consumers that can be used to defraud or extort money.

‘Vishing Scams’ – Like a ‘Phishing’ scam but carried out over the telephone or by voice-based communication (hence the ‘V’ at the start). These often take the form of an automated message requesting that the recipient presses a number to be connected to an operator.

Smishing Scams – Similar to both ‘Phishing’ and ‘Vishing’ but using text message or SMS (Hence the ‘S’ at the start).

 

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Example of a phishing email - scammers highlight sums owed in the form of tax rebates

 

HMRC Phone Scams

In 2018, HMRC reported receiving in excess of 100,000 phone scam reports. The apparent legitimacy of the numbers used to contact consumers was reinforced by the scammers use of numbers that appeared to belong to HMRC when checked online.

HMRC, in collaboration with the telecommunications sector and regulator Ofcom, have worked together to improve control of these numbers and prevent this ‘spoofing’. However, the evolving nature of these scams ensures that staying ahead of the fraudsters remains a challenge.

 

consumeradvice.scot Case Studies

consumeradvice.scot have received a variety of enquiries in relation to suspected HMRC scams. Some of these involve the consumer receiving an email or a letter through the post advising that a refund is due -

“…I received a text message from HMRC saying they had determined that I was due a tax refund of £228.37. I was advised to click on the link to begin the process. I did this and then I also received an email advising I was due a refund of £73.59. I clicked on the link and was asked for my name and postcode. I was then advised I would receive the refund within 14 days…”

Other consumers have been contacted and threatened with legal action for non-compliance with the requests of the caller –

“…For the last week I have had really nasty calls through from HMRC on my landline. They keep saying I owe money and need to contact my case worker. Today I have had a call to tell me that I have an arrest warrant out for me. I am really worried about these as there is no reason that I can think of for any of these things to happen…”

 

Positive messages and negative reinforcement

The complexity of HMRC scams continues to evolve. These scams often play on the emotions of the targeted consumer, using positive or negative reinforcement to manipulate and force the person into acting.

Positive messages may advise the consumer that they are entitled to large tax rebates or refunds, prompting vulnerable individuals to supply bank details and HMRC login details to ‘spoofed’ websites. Even more of the consumer’s personal information can become available once the scammer has access to usernames and passwords. Approximately 18.2% of HMRC scam reports received by consumeradvice.scot since April of last year advised members of the public that they were due refunds from overpayment of tax.

Conversely, negative reinforcement techniques play on consumer concerns about what will happen if they do not comply with the request of the ‘fake HMRC’, as many recipients are threatened with legal action or imprisonment. This is another prompt for the consumer to act immediately and can result in them providing financial information in order to avoid what they believe will be certain prosecution. 54.5% of the contacts received by consumeradvice.scot since April 2019 threatened consumers with warrants and legal action against them due to underpayment of tax to HMRC.

The threats made to consumers vary, with terms such as ‘fraud’, ‘legal action’ and ‘lawsuit’ used to overwhelm and worry the consumer into providing personal details.

“Over recent weeks I have been receiving cold calls from a firm purporting to be working with HMRC. The caller alleges that they are launching a lawsuit against me and ask that option 1 be pushed to speak with an adviser. I have not pressed option 1. The callers on the recorded message have a UK accent.”

These attempts to defraud are often repeated, with multiple calls, emails or texts received throughout the day -

“I have had 2 phone calls today. One this morning and another 20 mins ago from trader purporting to be HMRC. They said I would be arrested if I don't make payment. they didn't say how much exactly. They told me to press '1' but I realised it was a scam so didn't do so.”

“…I took a phone call and it was a recorded message. It was HMRC saying I was involved in a fraud case…I also got a message on my mobile phone as well.”

“They called saying I was the subject of an investigation by HMRC. I believe this to be a scam…”

 

Vigilance and reporting

The reporting of scams can be confusing for anyone, especially in cases where the scammer has been successful. By remaining vigilant, checking the source of engagement and avoiding making decisions in the moment, consumers can ensure that they don’t fall foul of attempted scams.  

consumeradvice.scot work directly in partnership with Trading Standards and the Scottish Government to tackle scammers and inform the public about the evolving nature of these crimes. With the help of reports from members of the public, and our colleagues at the various local authority Trading Standards and Trading Standards Scotland, we can shine a light on these underhand practises and stop them before more vulnerable consumers are affected.

 

consumeradvice.scot have put together our top tips for remaining aware and avoiding harmful HMRC scams -

Check the contact is legitimate - Check the source of calls, emails and texts by using the official website (don’t just rely on a Google search!). Remember that bodies such as HMRC will never request your bank details via email, text or phone.

Don’t panic – Remember that HMRC don’t tend to make threats of legal action or imprisonment on their first contact, even if they do have legitimate business with you. By immediately reacting, you play right into the scammer’s hands. Take a step back and assess your next step.

Keep notes & evidence – Take notes of dates and times of any contacts that you receive. By compiling evidence such as telephone numbers or email addresses, it makes it easier to highlight the scammers. Make sure to contact consumeradvice.scot to report your experience!

If unsure don’t supply any information – The scammers often use cloned login screens of legitimate companies to steal your username and passwords in order to access your online accounts and gather more information. If something doesn’t seem right, do not enter your details!

Report any suspicious activity – You can report any suspicious activity to consumeradvice.scot who will refer the details to Trading Standards for investigation. If you have inadvertently supplied personal information to someone you suspect is a HMRC scammer, then you should contact your bank and HMRC immediately to report the fraudulent activity.

 

consumeradvice.scot are able to offer free and practical advice on a number of consumer issues, including scams. You can contact consumeradvice.scot on 0808 164 6000. We are open 9am-5pm, Monday-Friday. You can follow us on social media – Twitter: @advicedotscot and Facebook at www.facebook.com/advice.scot, Instagram: @advice.scot, or get ahead by visiting our knowledge centre at www.consumeradvice.scot. 

 

 

 

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