Dangerous W-2 phishing scam evolving

The Internal Revenue Service, state tax agencies and the tax industry issued an urgent alert to all employers of the Form W-2 email phishing scam. We’ve seen this scam in recent years targeting the corporate world, however the scam has evolved their tactics to focus on more mass data thefts, including school districts, tribal organizations and nonprofits.

How the scam works

Cybercriminals use various spoofing techniques to disguise an email, making it appear as if it’s from an organization executive. The email is sent to an employee in the payroll or human resources departments, requesting a list employee personal information. The following are some of the details contained in the emails:

  • Kindly send me the individual 2016 W-2 (PDF) and earnings summary of all W-2 of our company staff for a quick review.
  • Can you send me the updated list of employees with full details (Name, Social Security Number, Date of Birth, Home Address, Salary).
  • I want you to send me the list of W-2 copy of employees wage and tax statement for 2016, I need them in PDF file type, you can send it as an attachment. Kindly prepare the lists and email them to me ASAP.

In the latest twist, the cybercriminal follows up with an “executive” email to the payroll specialists and asks that a wire transfer also be made to a certain account. Although not tax related, the wire transfer scam is being coupled with the W-2 scam email, and some companies have lost both employees’ W-2s and thousands of dollars due to wire transfers.

If you see the scam

Organizations receiving a W-2 scam email should forward it to phishing@irs.gov and place “W2 Scam” in the subject line. Organizations that receive the scams or fall victim to them should file a complaint with the Internet Crime Complaint Center (IC3,) operated by the Federal Bureau of Investigation. Employees whose W-2 forms have been stolen should review the recommended actions by the Federal Trade Commission at www.identitytheft.gov or the IRS at www.irs.gov/identitytheft.

The IRS, states and tax industry urge all employers to share information with their payroll, finance and human resources employees about this scam. Employers should consider creating an internal policy, if one is lacking, on the distribution of employee W-2 information and conducting wire transfers.

For more information on tax scams to be aware of, please visit the IRS website at www.irs.gov.