Scotts Valley detectives working with the Bank of America have solved a notorious fraud scheme and returned $3,000 to the victim.
Detective Michael Birley said that in April 2015 a Scotts Valley woman, Karen Kilner, was contacted by a man on the telephone claiming to be an Internal Revenue Service employee and saying that she owed back taxes. After being threatened with arrest and seizure of her assets, the woman complied, he said.
She withdrew $3,000 from her account, and deposited it into a Bank of America account number supplied by the “IRS employee.”
After depositing the money, Kilner realized that she may have been the victim of a scam, and reported the incident to Scotts Valley police.
Working with the bank, Birley discovered that the account held approximately $13,000 from other victims throughout the U.S. The Bank of America records showed that the account owner had paid approximately $7,000 in tuition to Santa Clara University from that account.
Subsequent investigation by Birley led to the arrest of an Indian student in the Santa Clara University graduate program in computer science. The student, in the U.S. on a student visa, and family members were allegedly involved in the fraud scheme.
Although the charges were dismissed this summer, the student was ordered to pay the victim $3,000, Birley said.
Lisa Crivello, vice president and manager of the Scotts Valley Bank of America branch office, said, “We are so pleased to recover the funds for this client with the help of the Scotts Valley Police Department. Their partnership is invaluable.”
“These scams are getting more and more believable, especially to our seniors,” she said. “This is something that everyone needs to be aware of and discuss with their aging parents, friends and neighbors.”
Birley said his department receives complaints of similar IRS scams each year. Unlike this case, which involved a local suspect, usually by the time the crime is reported the money can never be retrieved.
“We ask residents not to respond to these emails and phone calls that lure them into sending money,” Birley said. “Instead we ask them to bring what information they can into the police department and talk with an officer. We can usually identify if the email or phone calls are legitimate or not.”
This January, the Office of the Treasury Inspector General for Tax Administration announced it have received reports of roughly 896,000 phony telephone contacts since 2013. More than 5,000 victims across the U.S. collectively paid over $26.5 million to criminals in this type of scam in the same period. This fraud scheme is the most prevalent tax scam in 2016, the IRS said.
The IRS said it will never call to demand immediate payment, nor will the agency call about taxes owed without first having mailed you a bill, ask for credit or debit card numbers over the phone, or threaten to bring in local police.
The IRS has set up a special fraud hotline for this scam: 800-366-4484.