The 2016 tax season is now in full swing in the United States, which means scammers are once again assembling vast dossiers of personal data and preparing to file fraudulent tax refund requests on behalf of millions of Americans. But for those lazy identity thieves who can’t be bothered to phish or steal the needed data, there is now another option: Buying stolen W-2 tax forms from other crooks who have phished the documents wholesale from corporations.
Pictured in the screenshot above is a cybercriminal shop which sells the usual goods — stolen credit card data, PayPal account logins, and access to hacked computers. But hidden beneath the “other” category of goods for sale by this fraud bazaar is an option I’ve not previously encountered on these ubiquitous, cookie-cutter stores: A menu item advertising “W-2 2016.”
This particular shop — the name of which is being withheld so as not to provide it with free advertising — currently includes raw W-2 tax form data on more than 3,600 Americans, virtually all of whom apparently reside in Florida. The data in each record includes the taxpayer’s employer name, employer ID, address, taxpayer address, Social Security number and information about 2016 wages and taxes withheld.
Each W-2 record costs the Bitcoin equivalent of between $4 and $20. W-2 records for employees with higher-than-average wages in the 2016 tax year cost more, ostensibly because thieves stand to reap a higher tax refund from those W-2’s if they successfully trick the Internal Revenue Service and/or the states into approving a fraudulent refund in the victim’s name.
Tax refund fraud affects hundreds of thousands, if not millions, of U.S. citizens annually. Victims usually first learn of the crime after having their returns rejected because scammers beat them to it. Even those who are not required to file a return can be victims of refund fraud, as can those who are not actually due a refund from the IRS.
Tax data can be phished directly from consumers via phony emails spoofing the IRS or employers. But more often, the information is stolen in bulk from employers. In a typical scenario, the thieves target people who work in HR and payroll departments at corporations, and spoof an email from a higher-up in the company asking for all employee W-2 data to be included in a single file and emailed immediately.
Incredibly, this scam tricks countless organizations into giving away all employee W-2 data directly to identity thieves who use it (or, in this case, sell it) for tax refund fraud. Earlier this month, solar panel maker Sunrun disclosed that a spear phishing attack exposed W-2 tax form data on more than 3,400 employees.
In this case, however, it does not appear the cybercrime shop obtained the W-2’s through phishing employers. It cost roughly $25 worth of Bitcoin to reveal the likely common thread among all 3,600+ Floridians being exploited by this shop: A local tax preparation firm that got hacked or phished. Continue reading →