Top States With The Most Fraud Complaints

Fraud and scams cost Americans more than $1.6 billion last year. According to a report from the Federal Trade Commission (FTC), there were more than 2 million cases of fraud in 2013, down slightly from the previous year.

On average, there were 500 complaints per 100,000 residents in the 50 states. Eight of the 10 states with the highest rates had at least 600 complaints per 100,000 residents. Florida led the nation with nearly 1,000 total complaints per 100,000 people. Based on data published by the FTC’s annual Consumer Sentinel Report, 24/7 Wall St. identified the 10 states with the most fraud complaints. Nevada ranked number 3 on the list.

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MasterCard uses geolocation to make sure you are you

If someone steals your credit card, they’d probably have little trouble racking up a hefty bar tab or buying a new TV with the plastic. But MasterCard MA+0.01% is experimenting with a new technology to change that by using your smartphone’s geolocation to verify that you are in the same location as your credit card at the time of sale.

“We can actually make sure that when we see a transaction we can confirm you are actually where you say you are,” says James Davlouros, vice president of global strategic alliances at MasterCard. Currently, MasterCard’s pilot program is available in Europe, with a commercial launch scheduled later this year in North America, Europe, and Asia.

Read more at The Wall Street Journal

Tax Fraud Scheme Used Stolen Identities

With tax season upon us, most everyone is hoping for a refund from the IRS. According to a recent article, “IRS: Bad spelling led to crack in fraud case” by Kathy Lyn Gray, The Columbus Dispatch, it’s possible that someone may have already filed a return in your name. Two people accused of stealing more than 5,000 identities were charged with aggravated identity theft, conspiracy and wire fraud for the use of those identities to file tax returns resulting in a $1.3 million payout. Many of those families affected were on disability or other assistance, or have disabled children.

How were the fraud perpetrators able to get so many identities? Very easily, according to the authorities. The accused advertised on the internet that they could get money for a person if that person provided their social security number and other personal information.

What can we learn from this case of tax fraud?

Lesson #1: Protect your information – Most companies will not ask for your social security number, or they will ask you to only verify the last 4 digits. Be very skeptical if anyone asks you for your full social security number.
•Who are they?
•What are they going to do for you?
•Why do they need your private information to accomplish that goal?

Lesson #2: If it sounds too good to be true, it probably is – Research any “opportunity” that appears to get you easy money and err on the side of being too cautious rather than jump at such opportunities.

For more information on the warning sides of fraud, contact PBTK.

Tool Aims to Combat Identity Theft-Related Tax Fraud

From Accounting Today:

Tascet has released technology that it said tax preparers can use to prevent multiple filings of tax returns by fraudsters.

Identity theft-related tax fraud has been a growing problem for the Internal Revenue Service in recent years and has sparked several congressional hearings (see Congress Probes Tax Prep Fraud and Identity Theft and IRS and Social Security Urged to Curb Tax Fraud and Identity Theft). Treasury Inspector General for Tax Administration J. Russell George recently testified that up to $26 billion could be lost to tax identity fraud over the next five years. The filing of multiple false tax returns by the same individual presents the biggest challenge. The IRS reported that in 2011 approximately 940,000 tax returns with $6.5 billion in refunds involved identity fraud.

Click to read the full article from Accounting Today.

Alaska Drug Case Reveals $19 Million Tax Fraud

By Casey Grove, Anchorage Daily News

While investigating Anchorage cocaine dealers, authorities discovered a massive identity theft and tax fraud operation that illegally claimed about $19 million in federal tax refunds,prosecutors said.

U.S. Attorney for Alaska Karen Loeffler said Thursday it’s unclear exactly how much cash the federal government paid out to the defendants: seven illegal immigrants, three living in the country legally and a corrupt Wells Fargo bank employee, the U.S. citizen, who helped the alleged fraudsters. The 10 residents of Mexico and the Dominican Republic, working with a United States citizen, sent at least some of the money they allegedly stole from the U.S. Treasury out of the country, according to an indictment handed up this week.

“It’s a very large tax fraud case,and what I would call organized crime,” Loeffler said Thursday. “This is certainly the biggest (tax) case we’ve brought down in Alaska.”

2012 Report to the Nations on Occupational Fraud and Abuse Now Available

The seventh issue of the Association of Certified Fraud Examiner’s (ACFE’s) Report to the Nation on Occupational Fraud and Abuse is now available.

The 2012 Report to the Nations is based on 1,388 cases of occupational fraud that were reported by the Certified Fraud Examiners (CFEs) who investigated them. These offenses occurred in nearly 100 countries on six continents. The data demonstrates that consistent patterns of fraud are found around the globe. This consistency reaffirms the value of the ACFE’s research efforts and the reliability of the findings as truly representing the characteristics of fraudsters and their schemes.

The information contained in this Report can help in your efforts to prevent, detect or simply understand the global economic impact of occupational fraud. If you would like a free hard copy of the report, please contact PBTK’s Director of Forensic Accounting and Litigation Services, Mike Rosten at or 702-384-1120, or a digital copy is available here.

Smart Phone Use Related to Identity Theft

A Reuters article recently printed in the Chicago Tribune discusses how smart phone use and the large increase in identify theft can’t be a coincidence. Here is an excerpt from the article:

“Nearly 12 million Americans were victims of identity theft in 2011, an increase of 13 percent over 2010, according to a report released on Wednesday by the research firm Javelin Strategy & Research. The rise in the use of smartphones and social media by incautious consumers fueled the increase in identity fraud, and 2011 was a year of several big data breaches too, Javelin said.”

Click here to read the full article.