According to Securitas India, Overall, identity theft and fictitious identity cases continue to contribute around three-fourths of all detected fraud cases, in India. Tax identity fraud occurs when scammers steal personally identifiable information to file a phony electronic tax return on behalf of their victim and then collect their refund.
Tax refund fraud has exploded in recent years. According to The report by Experian India, auto loans, mortgage loans, credit cards, tax returns along with various financial products, witnessed the largest number of fraud cases from identity theft representing 85% of the total detected frauds in 2015. And unfortunately for victims, resolution can be complicated as victims generally learn about the fraud when they attempt to file a return and learn that one has already been filed in their name.
But there are simple steps you can take to protect your identity. One of the most important actions you can take is to safeguard your Aaadhaar card, PAN card as well as credit card numbers, bank account numbers and other sensitive personal information like your old tax returns.
Here are few tips which can help minimize the risk of becoming a victim of identity theft during tax season.
1. Don’t procrastinate: File earlier to reduce the window of time for criminals to file a false return.
2. Never send emails containing personally identifiable information (PII): Trusted professionals should never request this information in an unsecured format. Instead, use a trusted, encrypted online platform
3. Beware of digital scams: According to the Symantec Internet Security Threat Report 2017, the malware attacks in India were 1.3% in 2015, but reached 10.4% in 2016. Utilize the Device Software Security available with your identity protection program, which has anti-virus and ransomware blocking features.
4. Always use a professional, trustworthy tax preparer: Sometimes, even national tax preparation chains can scam you out of money or use less-than-secure procedures when it comes to handling your personal information. Make sure you use someone you trust.
5. Never provide personal information to someone claiming they are from the Tax department without authentication.