From Birch Gold Group
Scams and frauds are often as creative as they are crooked, and the latest string of Social Security scams that has been sweeping the nation is yet another example of this. Like most scammers, the perpetrators are either looking to get cash before hanging up the phone, or are hoping to harvest personal information for a more elaborate scam at a later date.
Hang up, that’s not Social Security calling to threaten you
The Social Security media scam is fear-driven, and often marked by meticulousness. The scammers will phone or contact the victim, posing as a Social Security agent and informing them that their Social Security account has been compromised. The fraudsters know their way around technology, and are able to spoof the caller ID to make it look as if the call is coming from Washington, D.C.. Sometimes they will also present an agent’s badge or other information to persuade the respondent of their legitimacy.
From there, the threat of a person’s bank account and assets being compromised is presented, almost universally due to a supposed connection with criminal activity. With so many media reports pertaining to drugs crossing the border between Texas and Mexico, it isn’t surprising that many fraudsters are attempting to convince the victim that they have somehow become involved with a drug cartel.
There’s another big give-away from scammers masquerading as Social Security agents…
“You must buy a Walmart gift card for $500 or your Social Security number will be suspended”
Depending on the nature of the call and the scam in question, the victim might be asked to give out their Social Security number for verification, or to assist in an investigation. In other cases, scammers will take on a more bold approach and ask the victim to send out money, presumably to pay a fine so that the issue might be resolved.
It’s the manner of collecting this alleged fine that’s really strange. Alleged Social Security enforcement agents have demanded immediate payment in an absolutely bewildering array of methods, including:
- Bank wire
- Pre-paid debit card
- iTunes gift cards
- Big-box retail store gift cards
- Cryptocurrencies (including bitcoin)
The Office of the Inspector General for the Social Security Administration notes:
If you ever owe money to Social Security, the agency will mail you a letter with payment options and appeal rights. Social Security does not suspend Social Security numbers or demand secrecy from you in resolving a problem – ever.
The scam has garnered enough attention that some nation-wide retail chains, including CVS, Home Depot, and Walmart have instituted in-store announcements and warnings against buying gift cards to pay scammers’ imaginary penalties. The FTC has an interesting take on this:
Gift cards are like cash: if you buy a gift card and someone uses it, you probably cannot get your money back. Gift cards are for gifts, not payments. Anyone who demands payment by gift card is always a scammer.
Social Security Commissioner Andrew Saul said in a recent interview that he hopes to kickstart even more awareness campaigns. And that’s a good thing, because, according to the Federal Trade Commission, the fake Social Security collections call was the most common type of scam last year, tricking people into losing a combined $22 million over the 12-month period.
Gail S. Ennis, inspector general for the Social Security Administration, said that scammers target all age groups with robo-dialing in a form of “see what sticks” scheme. Though older persons, who are more likely to have larger bank balances, seem to be the preferred target.
Ways to handle a scam call
As with any scam, the most important thing is to critically assess the situation and remain composed. Even if a person is involved in criminal activity, Social Security staff a call center full of collections agents to threaten to seize assets, or suspend their Social Security number.
If you get one of these calls, hang up and make a report to local authorities to assist them with prevention of such scams in the future. You can also report a Social Security scam here.
Remember:
- Scammers can spoof your caller ID
- Social Security doesn’t threaten people
- Social Security will never demand a bank wire, bitcoin or iTunes gift cards
- Social Security won’t suspend your SSN
- NEVER verify your Social Security number or other personal information to someone who calls randomly.
Knowing what to look out for is key to defending against most scams. To help you detect and avoid financial scams, Birch Gold Group has pulled together an extensive resource guide that is now available on our website. The Birch Gold Group Scam Protection Resource Guide helps you identify warning signs and provides you with tips on how to avoid fraud.