Massive IRS Scammers Plead Guilty, Face Long Jail Terms

By - November 30, 2017
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A huge IRS call center scam based in India, where scammers ripped off Americans to the tune of $300 million by acting like IRS agents to collect back taxes, has completely unraveled as of November 2017. The very last defendant – Indian American Miteshkumar Patel of Willowbrook, Illinois – pleaded guilty last week that was prosecuted by the Department of Justice.

Five other Americans from India also have copped guilty pleas after being heavily involved in the IRS scam that allegedly ripped off more than 15,000 gullible Americans. The names of the other men who have pleaded guilty to federal charges are Sunny Joshi, 47, of Sugarland, Texas; Jagdishkumar Chaudhari, 39, of Montgomery, Alabama; and Rajesh Bhatt, 53. Each of them pleaded guilty to money laundering.

Also, Raman Patel, 82, of Gilbert, Arizona; and Praful Patel, 50, of Fort Myers, Texas; along with Jerry Norris of Oakland, Calif., each pleaded guilty to federal charges of conspiracy to commit fraud, as well as money laundering. Six of the Indian men have been held in federal custody since Oct. 2016 when they were arrested. The DOJ stated that the men will be kept behind bars until they are sentenced.

A total of 53 people from India were named in the federal indictment. One of them was the call center rip off mastermind Sagar Thakkar, who was arrested last April in Mumbai.

Phony IRS Agent Scam Operated Under Many Business Names

The IRS scammers had several business names they used to conduct their fraud. Some of the company names were HGlobal, Call Mantra, Worldwide Solution, Zoriion Communications; and Sharma BPO Services. Other than the IRS scam, the scammers also prevented to be US Citizenship and Immigration officers. They told immigrants that they faced immediate deportation unless they ponied up fines for (non-existent) problems with their immigration documents.

The fake agents also ran a payday loan fraud. This scam offered Americans unsecured, short term loans, which had to be paid back with their next paycheck. The scammers demanded up front money to prove they were a good financial risk. The victims later lost their money and never got anything in return.

The phony IRS workers did not stop there. They also ran a scam giving out government grants. They offered fake grants that never had to be paid back. The people who fell for the scam were required to pay a processing fee or IRS tax, but never got anything out of it.

The 81-page federal grand jury indictment offers a high level of detail about how these phony IRS call centers work. The workers ask the victims to buy prepaid cards at CVS or Walgreens that have hundreds of dollars loaded onto it. The cards can be then used to buy reloadable cards that have dollar value. Then, the cards can be used as debit cards and do not have to be connected to a bank account. The cards can be used again to have funds added. The fraudsters during this process get the victim’s’ social security numbers, addresses and dates of birth. This allows them to engage in identity theft and rip them off again.

According to the Department of Justice, at least 50,000 people had their identities stolen, and 15,000 people were ripped off.

The illegal companies purchased leads – victim lists – from various lead generators, which utilize proprietary information to generate large numbers of leads that are sold to other companies. In the federal indictment, there was no explanation by DOJ about how lead generators products the large victim lists. The phony agents then used VOIP and Magic Jack lines to make it appear that their calls originated from the US. In the case of schemes for government grants, the calls appeared to come from federal agencies.

IRS Scams Are Nothing New, Experts Say

It is very common for the IRS to be impersonated in various phone and online scams. Fraudsters know that Americans fear and loathe the tax agency. If they call or contact enough Americans or US permanent residents, it is inevitable that someone will cough up hundreds or even thousands of dollars out of abject fear of the IRS.

The good news on this front is that the FCC this month has green lighted new rules that could put an end to the huge number of robocalls by IRS scammers and various other fraudsters. The FCC states there are 2.4 billion illegal robocalls each month, with many of them involving IRS scams. The FCC states that the problem is worsening because today’s affordable technology makes it easy for scammers to dial hundreds of thousands of people per day.

But the FCC is now going to give telecommunication firms more leeway to block calls that they think might be fraudulent. This has been something that the industry did not want to do because it could lead to complaints of the companies restricting competition. It also could potentially violate the call completion rules set up by FCC that require that dialed calls go through to the customer.

Now, however, the phone industry is allowed to block some of these scammer phone calls. Some of the ones most likely to be blocked are those that have uncommon digits, such as 1-222-555-1111. Others likely on the FCC chopping block are numbers that are unused, numbers that have not been assigned to providers, or numbers taht are only intended for incoming calls. The FCC chair states that calls that fall under these parameters are highly likely to be scammers. The agency notes that there is no good, legal reason for anyone to try to outfox caller ID to make it seem like they are calling from the area when they are actually calling from outside the state or country.

Most Americans would benefit from the blocked phone calls, but the IRS would benefit as well. The IRS is regularly impersonated by scammers. The agency features phone numbers that are only used for incoming calls, but under the new FCC rule, any outgoing calls that are using such numbers can be blocked.