She got a letter, with a large check in it, from Green Dot Bank. It referenced Santa Barbara Tax something-or-other.
The letter said that because they had been unable to direct deposit the refund using the payment information provided, they were sending a check representing their federal (and state, if applicable) refund, minus some fees. For their 2019 tax return. There was an 800 number to call for info. I googled that and it’s legit. The Green Dot / Santa Barbara thing seems to be related to filing through TurboTax and asking them to deduct the fees from your refund.
The in-laws did not file a 2019 tax return. They are elderly, living on Social Security only, and do not need to. MIL was confused of course. and a bit hopeful that it referred to something from some time in the past as they could surely use the money, but she at least knew to call me.
My first thought was one of two things:
some kind of advance-fee scam, but there’s no indication of any request to deposit it and send some of the money somewhere (plus MIL knew better than to do that, as she’s heard of that scenario).
Someone filed a fake tax return using their information. This is, unfortunately, something that scammers do. Then the real person goes to file, and can’t, because “they” already filed with fake information and got a large refund.
I’m leaning toward the latter scenario. I’ve sent MIL links to various IRS sites to request copies of any returns filed under their name, and for the form to report possible fraud. I suggested she call the 800 number (since it seemed legit) but NOT to give them any details such as Social Security number.
Assuming my guess is correct: I have to wonder if the scammer either goofed on entering the direct deposit info, or got caught and had his bank account shut down before the in-laws’ “refund” got processed.
The part that really puzzles me is that the check got mailed to their home. Do scammers usually use the dupe’s real address?
Thoughts? If I’ve guessed right, what other steps ought we or they take?
First, when you mouse over a title on a given forum’s home page it’ll show you the first few lines of the OP. In this case, at least on my monitor, it line breaked before the word ‘Barbara’; therefore, the obvious answer would be to call the Easter Bunny.
Green Dot Bank in the bank that sent out the check; they are probably the legitimate bank that has the account for the Santa Barbara Tax something-or-other; they wouldn’t be able to help any more than if you called my bank for a check that I wrote you.
What the scam I’ve heard with unemployment (& probably other gov’t agencies) is that they sign the identity theft victim (ITV) up, ITV then gets a check/direct deposit from unemployment. Scammers then contact ITV & state that the payment was in error & to please pay it (back) to ___ (scammers account). Then, when the unemployment dept finally does their audit & realized that ITV doesn’t deserve that payment they demand it back; of course, the ITV no longer has the money to return because they sent it to the scammer but they still need to pay back unemployment services so they are out whatever they originally got/sent to scammer.
Call the IRS Identity Protection Specialized Unit at 1-800-908-4490. Among other things, they can probably (there is some variability depending on what state your in-laws live in) set up a 6-digit PIN that will be required for filing any future returns.
I believe that Santa Barbara Bank and Trust is a legitimate bank that has a pretty large share of the Refund Anticipation Loan market, for which they will pay someone their tax refund within days after deducting online filing fees plus their own fee from the refund. IMHO if your MIL received a tax refund check from them, but has yet to file, someone else likely filed a fraudulent return in their name but for some reason the fraudster’s bank rejected the direct deposit (probably b/c your MIL’s name was not on the designated bank account) so they sent her the check.
That seems like a strange way for them to proceed. If the designated bank account does not have the taxpayer’s name on it, that should be a red flag for something fishy going on. It should trigger a fraud investigation, not a further attempt to pay out the refund in a different way.
I agree, but based on my experience working in the tax field, which admittedly was about 15 years ago, that is a likely explanation for why someone might get an unexpected check from SBB&T.
Do banks cross-check names on accounts when receiving an electronic deposit like this?
I’m pretty sure that the majority of these tax-refund scams are done using direct deposit. The scammers certainly could not open bank accounts for each of their victims, as banks usually demand some sort of ID to open an account.
Or here’s another approach: Scam Alert: Beware Of The Fake IRS Refund Check - I’ll have to forward that to the in-laws. FIL was gung ho about taking the check to the bank, asking THEM if it looked legitimate, and depositing it. And they’d definitely have been panicked into remitting the money to someone if they got threatened.
Eh. It should be done but is not always practical to be done. The problem is that the name field in an ACH record is only 22 characters long.
A full name field is going to be at least 30 chara/line or combo of fields (prefix, first, mid, last, suffix, etc.). The only screen you could see the full name was on the registration page. On other pages, like activity or position pages, at the top we had a ‘short name’ - 10 chara long to let you know that, yes, you were in the right account with a quick glance.
Therefore the registration of a longer name would be the “Jonathan Knickerbocker & Madelline Johnson-Knickerbocker IRR Family Trust” but the short name would be “Trust Knic” or “Tr Knicker”. Whether we sent short name (which is what our firm did) or sent the first 22 chara of registration, Madelline’s name did not appear anywhere in what we sent. If that ACH was going to Madelline’s individual account would the bank reject that because it didn’t appear to be coming from her account? ACH has been around since the 70’s; AI is a relatively new thing. Therefore, until recently the only way to name match would be to have someone manually look at every ACH item where the name didn’t match. & remember, depending upon your system John M. Doe (w/ a period after mid initial) is not the same as John M Doe (no period after MI) or John Doe (no MI). Do you really think one of the large national banks is going to have an entire staff of people manually check the thousands of name mismatches they get every day? In all the years I was doing that stuff, we had a whopping one reject for name mismatch, & that was from a small one-branch bank that probably didn’t get a lot of ACH therefore they could do name matching without needing an army of staff.
Bumpdate: Per some research I did, this scam works by the scammers having the money direct-deposited to the victim’s account (or check mailed to the victim) - then later calling, pretending to be the IRS, and requesting immediate return of the refund that was issued in error / as a result of fraud.
Only, the money goes to the scammers. Then later on the IRS catches up, and also goes to the victim and demands the money back.
We’ve had the in-laws file requests for copies of their prior years’ returns, and also helped them file a fraud notification with the IRS.
Amusingly enough: a few weeks after they got their “refund” check, Intuit sent them a bill for the unpaid filing fee (why that wouldn’t have been deducted from the check, I don’t know). MIL called someone at Intuit and said “we never filed” - so hopefully Intuit’s internal fraud investigators are also working on it.
FIL was still harping on wanting to deposit the check; when you’re elderly and on a fixed income, such a windfall can override your normal common sense. We finally told MIL to take the check away and write VOID on the front, to keep him from attempting it.
