The Australian tax office has warned the public of scammers demanding payment in Bitcoin and other cryptocurrencies. As expected, these payments would go to the scammers’ digital currency wallets and not to the government.
The revelation was made by the Australian Taxation Office (ATO) which said that these con artists are threatening to use federal police to arrest individuals who are yet to settle their tax obligations.
A Typical Case of Tax Scam
There is the case of an individual conveniently named Darren who was asked to make a tax payment of $9000 the same day to a Bitcoin wallet or face the threat of 5 years imprisonment. The scammer would later call Darren’s tax agent to whom he was referred to in the quest to convince the duo to make the payment.
The ATO in its website said that the case of Darren who was threatened to make payment the same day or face jail term exemplifies an increasingly common trend. Scammers are taking advantage of the pseudonymous and anonymous nature of some digital currencies to defraud people.
Unfortunately, Darren under duress gave the contact of his tax agent to ‘Grey’ the scammer. Grey would later claim that the agent was in a meeting and another individual who claimed to be the agent’s colleague corroborated the scammer’s version of the story that claimed Darren had tax debt of $9000.
A Three-Way Conversation
“A fake conversation was had between Mr Grey and the original scammer with Mr Grey agreeing there was an error with Darren’s tax return and that he owed money to the ATO,”
stated the website of the Australian taxation agency.
“Mr Grey told Darren to go to a specific location and pay the $9,000 today. Darren withdrew cash and deposited it into a Bitcoin [ATM] machine.”
Scammers Demand Unusual Tax Payment Methods
The ATO further warned the public to be wary of tax debt claims that ask for payments to be made through unusual method. The agency stated that the scammers sometimes demand that tax debt be paid through prepaid debit cards, iTune balance and store gift cards. ATO however informed the public that the best preventive measure against tax scams is to be informed about what they owe the tax agency. This way, scams will easily be seen for what they are and prevented.
An Old Strategy Refined
This is not the first time ATO is warning the public regarding possible tax scams. The tax agency in 2017 warned that con artists were impersonating officials of the agency. Kate Anderson, the assistant commissioner said then that more than $50,000 was paid to scammers posing as tax officials.