Unusual income tax-filing scam proves taxing for ID fraud victim to remedy

Early last month, Duong began calling CRA to let them know he wasn’t entitled to the money and wanted to return it. The agent, however, refused to discuss the matter because the Montreal address on file — the one used by the fraudsters — didn’t match any Duong could come up with. A second attempt also failed.

“That’s the scary thing about identity theft,” said Duong, now of Fairfax, Va. “If the identity thieves are good at what they’re doing, they lock you out of your own stuff.”

After several false starts, a third attempt proved more fruitful: A different agent was able to connect his parents’ address to his 2006 filing.

“That’s when she told me that someone had filed 2015 and 2014 tax returns as me.”

Initially, a CRA investigator mused it might have been a simple case of a misplaced digit on a social insurance number — except the person who filed the paper returns also had Duong’s date of birth as well as his name. Just how someone was able to get that personal information is a puzzler, especially given his 10-year absence from Canada and infrequent use of his SIN.

In the interim, a 2013 return was filed in his name. This time, the scammers included new banking information, and CRA deposited $1,500 into that account.

The second bank had no record of an account under Duong’s name or social insurance number, but that didn’t matter when CRA tied the information to him. What happened to the money — deposited two weeks after Duong first alerted the tax department — is unclear.

CRA agents also told Duong the agency normally tries to recover such funds from the victims.

“People are double victimized: Their identity has been misused and the government is going to come after them to recoup that money,” Duong said. “It just doesn’t seem fair.”

In a lengthy emailed response to The Canadian Press, a CRA spokesman said the agency was “sensitive” to the fact that fraud victims can have unique circumstances.

“CRA will work with victims in order to resolve all outstanding issues,” David Walters said.

Walters also said the agency did not know how often the tax-filing scam occurs or what it might cost the treasury, because CRA does not track those statistics.

What became clear, Duong said, was the lack of appetite for tracking down the fraudsters, despite having an address and bank account information to work with. Walters said it wasn’t up to the agency to investigate.

“CRA primarily administers taxes and benefits, and is not equipped or mandated to pursue scammers,” Walters said.

Duong said agents advised him to instruct his bank to return the money, which he did, and to report the scam to the RCMP Anti-Fraud Centre, which urged him to buy credit reports and monitor his credit activity.

CRA also advised him to alert other federal agencies that his personal information had been compromised because privacy rules bar them from doing so, and no central clearing house exists.

Walters said CRA has verification procedures and other ways to protect a taxpayer’s account, and takes unspecified additional measures if suspicious activity is identified. Still, he said, it remains up to victims to report scams to the anti-fraud centre, local police and their banks.

All in all, Duong said he felt hardly reassured.

“Because there’s no willingness to investigate this, I just have to live knowing that this information is out there and can be misused again at any time. It’s a little bit disconcerting.”

Figures show more than 36,000 Canadians filed identity-theft complaints with the anti-fraud centre over the last seven years, reporting losses of about $80 million.

The centre’s Daniel Williams said filing fake returns under someone else’s name appears to be uncommon, especially compared with scams that rely on victims’ inadvertently divulging sensitive information by clicking on a link in a “phishing” email.

Colin Perkel, The Canadian Press

by Canadian Press

Unusual income tax-filing scam proves taxing for ID fraud victim to remedy

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