Planning and preparedness will help safeguard your financial well-being
As the 2024 tax season unfolds, investors and taxpayers are facing a formidable new threat that leverages cutting-edge technology to perpetrate fraud. Artificial Intelligence (AI) has become the latest tool in the arsenal of cybercriminals, enabling them to create lifelike images and convincing videos that impersonate taxpayers. The goal? To deceitfully claim tax refunds that rightfully belong to others. This surge in AI-assisted tax scams signals a critical juncture for individuals to fortify their defenses against these sophisticated forms of identity theft.
The Significance of the Threat
The implications of falling victim to tax-related identity theft are dire, with individuals averaging a grueling 19-month wait for the Internal Revenue Service (IRS) to resolve the issues and process their refunds. This extended period not only ties up financial resources but also leaves victims vulnerable to further exploitation and fraud.
Understanding the Mechanism of Fraud
The modus operandi of these AI-driven scams involves collecting exhaustive personal information about potential victims. This data, ranging from pictures and physical addresses to employment details, may be sourced from public postings, both legal and illegal databases, or secured through deceptive email phishing techniques. Armed with this information, scammers exploit AI to fabricate remarkably convincing identities to mislead tax authorities and siphon off refunds into fraudulent accounts.
Preventative Measures for Investors
Given the escalating threat posed by these scams, the IRS has outlined several crucial steps to help taxpayers protect themselves and their assets:
Prioritize Early Filing: Filing your tax return as early as possible can significantly reduce the window of opportunity for fraudsters to file in your name.
Opt for Direct Deposit: Receiving your refund via direct deposit can circumvent the risks associated with mailed checks, which could be intercepted or fraudulently redirected.
Secure Your IRS Account: Proactively setting up an account with the IRS online ensures that scammers cannot create one in your name, a tactic often used to perpetrate fraud.
Be Wary of Suspicious Communications: It is vital to remember that the IRS does not initiate contact with taxpayers through phone, text, or email for the purpose of requesting personal or financial information. All legitimate correspondence from the tax agency is conducted via postal mail.
A Call to Vigilance
The advent of AI-assisted tax scams underscores the need for heightened awareness and proactive security measures among investors and taxpayers alike. By adhering to the IRS’s recommendations and maintaining a critical eye towards any communication purporting to be from the tax agency, individuals can significantly mitigate the risk of falling prey to these advanced forms of identity theft.
Planning Matters
In this evolving landscape of digital fraud, knowledge and preparedness are the keys to safeguarding your financial well-being. As technology continues to advance, so too does the sophistication of the threats we face. Therefore, staying informed, vigilant, and proactive in protecting your personal and financial information is more crucial than ever.
Source: Copyright © 2024 FMeX. All rights reserved. Distributed by Financial Media Exchange.
Amy Anderson joined the ILG Financial team in 2023 as the client relations coordinator. Her responsibilities include scheduling of appointments, annual check-up notifications, and annuity and required minimum distribution assistance. She is a graduate of Harding University with a degree in Computer Information Systems. Amy and her husband have two children and she enjoys reading, crocheting, music and spending time with her family.
Chase Lopez joined the ILG Financial team in 2020 as an advisor. Chase is a 2016 James Madison University graduate with a degree in management. Chase has been trained under the tutelage of Dave Lopez, who is not only the founder and managing member of ILG Financial, but also is Chase’s uncle and godfather. He also enjoys working alongside his cousin, Megan, who is Dave’s daughter. Chase, as a fiduciary, believes in putting his clients interests first, and building out plans for his clients where they can have a happy and fruitful retirement. He married his beautiful wife in February 2022 and both use most of their free time chasing around their little pup, Aurora.
Jessica Carson joined the ILG Financial team in 2018 as an agent. Jessica and her husband have four children, two dogs, 3 barn cats, 5 chickens, and three parakeets. She indeed loves her children and pets! When not at work, Jessica enjoys playing the piano and cello as well as traveling and spending time outside with her family, hiking, fishing, and boating.
Terri Center joined the ILG Financial team in 2019 as client services manager. She handles client records, application processing, and gathering information to provide a professional and friendly experience with all of our clients. Terri is a graduate of Oakland University. She is married and has two children. She enjoys hiking, family time, and puzzle challenging video games. She also likes to share her creativity in her canvas paintings and sewing projects.
Megan Jones joined the ILG Financial team in 2020 as marketing director. Megan and her husband live in Fredericksburg, VA with their German Short Haired Pointer, Gus. Megan is a graduate of Longwood University and holds a degree in communications. Megan is the oldest of Dave Lopez’s three children and not only enjoys working alongside her father, but also with her cousin, Chase, who joined the ILG Financial team in 2020 as an advisor. When not at work, Megan enjoys sitting on the back porch with family and friends enjoying food and music.