It wasn’t me: the tax fraud scam

One of the most prevalent tax scams involves unauthorised access to myGov accounts. Scammers exploit the wealth of personal data stored in these accounts, change bank details, and use the information to orchestrate substantial fraudulent refunds. The alarming reality is that it appears to be your actions, and the most distressing part is that you may have unwittingly granted the scammers access to your account.

It’s not just activity statements that are at risk. Any myGov-linked service capable of issuing refunds or payments is a potential target. Scammers exploit the amendment periods in tax law to manipulate existing data and trigger refunds on personal income tax, goods and services tax (GST), and pay-as-you-go (PAYG) instalments. Their level of understanding of Australia’s tax and social security system is often remarkably advanced.

Once the scammers have access to your myGov account, they can do a lot of damage.

So, how do these scams occur, and why are they so widespread? The answer lies in the vulnerability of humans, who are often the weakest link in the security chain.

Common scams utilise emails (78.9% of reported tax-related scams in the last 12 months) or SMS (18.4% of reported scams) that mimic communication you might typically expect to see. The lines of attack used by tax-related scammers are commonly:

• Fake warnings about attempted attacks on your account (and requiring you to click on the link and confirm your details);
• Opportunistic baiting where some form of reward is flagged, like a tax refund, that you need to click on the link to confirm and access; and
• Mimicking common administrative notifications from the Australian Taxation Office (ATO) like a new message accessible from a link.

Approximately 75% of all email scams reported to the ATO to March 2024 were linked to a fake myGov sign-in page.

How to spot a fake

Often, the first sign that something is amiss is alerts about activity on your myGov account or a change in details – which may be ironic if how scammers got into your account in the first place is via these very same messages. But there are ways to spot a fake:

• The ATO, Centrelink and MyGov don’t use hyperlinks in messages. If you receive a message with a link, it’s a fake. 
• The ATO will not use QR codes as a method for you to access your account.
• The ATO will never ask for your tax file number (TFN), bank account details or your myGov login details over social media. Some scammers have used fake social media accounts, mimicking ATO and other government agencies. When a query comes in, they respond by asking for information to verify it’s you. The ATO will never slide into your DMs. ATO Assistant Commissioner Tim Loh said, “It’s like giving your house keys to a stranger and watching them change your locks.”
• The ATO does not use pre-recorded messages to alert you to outstanding tax debt. The ATO will not cancel your TFN. Some scammers suggest that your TFN has been cancelled or suspended due to criminal activity or money laundering. They tell you to either pay a fee to correct it or transfer your money to a ‘safe’ bank account to protect you against your corrupted TFN.
• The ATO will not initiate a conference call between you, your tax agent, and/or someone from a law enforcement agency. In one case, the taxpayer was told that the caller was from the ATO, and a person from her accounting firm was also on the call to represent her and work through a problem. The ATO caller and the tax agent were fake. Just hang up and call our office if you are ever concerned. The ATO will never initiate a conference call of this type.
• The ATO will also not ask you to reconfirm your details because of security updates to myGov. The link, when activated, takes you to a fake myGov web page that can look very convincing.

In general, you should always log into your myGov account directly to check on any details alerted in messages rather than clicking on links. This way, you know you are not being redirected to somewhere you should not be.

And don’t log into your myGov account using free Wi-Fi networks. Ever.

Who is getting scammed?

There is a pervasive view that older, technology-challenged individuals are the most at risk. While this might be the case generally, scamming impacts all age groups.

The ATO reports that 25-34-year-olds are the most likely to provide personal information to scammers. This age group is also more prone to falling for investment scams. Shockingly, Australians reported losing a massive $382 million to investment scams in the 2023-24 financial year, with nearly half (47%) of the losses involving cryptocurrency. These figures underscore the serious financial impact of scams on our society.

Other scams

Scammers are in the business of scamming and they will use every trick and opportunity to part you from your money.

Investment scams

Pig butchering. Pig butchering is a tactic where scammers devote weeks or months to building a close relationship with their victims on social media or messaging apps before encouraging them to invest in the share market, cryptocurrency, or foreign currency exchanges. Victims think they are trading on legitimate platforms, but the money is siphoned into an account owned by the scammers, who created fake platforms that look identical to well-known trading and cryptocurrency sites. Scammers will show fake returns on these platforms to convince victims to invest more money. Once they have extracted as much money as possible, the scammers disappear with all the invested funds.

Deepfakes. Deepfakes are lifelike impersonations of real people created by artificial intelligence technologies. Scammers create video ads, images, and news articles about celebrities and other trusted public figures to promote fake investment schemes. These can appear on social media feeds or be sent by scammers through messaging apps. Unusual pauses, odd pitches, or facial movement not matching their speaking tone are often giveaways, but increasingly, the fakes are difficult to spot.

Invoice scams

The names and details of legitimate businesses are used to issue fake invoices with the money transferred to the scammer’s account. These scams are often tied to cyber breaches where hackers have accessed your systems and have identified your suppliers.

Bank scams

There has been a lot in the media lately about people receiving phone calls purporting to be from their bank, advising them there is a problem with their account, and then walking them through a resolution that involves transferring all their money into a ‘safe’ scammer’s account. Victims commonly state that they believed the scammer because of the level of personal information they relayed.

Your bank will never send an email or text message asking for any account or financial details, including updating your address or log-in details for phone, mobile, or internet banking.

A CHOICE survey found that four out of five of the victims of banking scams in their report said their banks did nothing to flag a fraud before they transferred their money to the perpetrator.

The Australian Banking Association has stated that banks will introduce warnings and payment delays by the end of 2024, if not already. In addition to other measures, they will limit payments to high-risk channels such as crypto platforms.

What to do if you have been scammed

myGov

If you have downloaded a fake myGov app, have given your details to a scammer, clicked on a link from an email or text message or scanned a QR Code, contact Services Australia Scams and Identify Theft Helpdesk on 1800 941 126 or get help with a scam here.

Tax scams

Please contact us before acting on any instructions, and we will verify the information for you.

If you have already acted, remember that the ATO is your ally. You can verify or report a scam on 1800 008 540.

The government uses an external agency, Recoveriescorp, to collect debt, but we will advise you if you have an outstanding tax debt.