Scammers are using the foreign account tax compliance act (FATCA) to mislead foreign financial institutions that they are from the IRS. These scammers are asking for account holders' confidential information, which they later use to carry out tax fraud and other financial crimes. Emailing is the fraudsters' preferred method of communication.
Scammers often use changes in the tax laws and new tax rules implemented by the IRS to deceive unsuspecting people. As many taxpayers and financial institutions are not aware of all the regulations due to the newness of the rules, scammers are often successful in their attempts.
Under FATCA, foreign financial institutions are required to report the details of the financial transactions they have with U.S. citizens. Scammers are sending unsolicited emails to various foreign financial institutions pretending to be the IRS with the intention of extracting sensitive information that can be used to conduct crimes.
IRS Commissioner John Koskineen said, "Tax scams using the IRS name can take many forms and they are not limited by national borders. People should always be cautious before sending sensitive information to anyone."
It is uncommon for scammers to target financial institutions. Due to the difficulty in tracing emails, scammers can easily obtain sensitive information through methods such as phishing. In order to avoid falling for phishing scams, any unsolicited email that asks for you to share private information should be flagged. Any links included should not be clicked on, as they might have malware. Suspicious email claiming to be from the IRS should be forwarded to firstname.lastname@example.org.