Consumers expecting a tax refund might be looking forward to filing their taxes early this year, but Better Business Bureau of Southern Arizona warns to be cautious of tax preparers who claim they can get larger refunds than their competitors.

According to IRS investigators, some preparers may use their clients’ personal information to file falsified returns, and may keep most of the fraudulent refund for themselves while leaving you on the hook.

It’s important to note that the taxpayer is ultimately responsible for the accuracy of all information on a tax return, even if someone else prepares it.  Individuals with fraudulent tax returns can face significant prison time as well as payment of back taxes with interest and penalties.

BBB recommends following these tips from the IRS:

• Avoid preparers who base their fee on a percentage of the refund.
• Use a reputable tax professional who signs the tax return and provides you a copy.
• Consider whether the individual or the tax preparation firm will be around to answer questions about the tax return months, or even years, after the return has been filed.
• Check the preparer’s credentials.  Only attorneys, certified public accountants and enrolled agents can represent taxpayers before the IRS in matters including audits, collections and appeals.
• Find out if the preparer is affiliated with a professional organization that provides its members with continuing educational resources and holds them to a code of ethics. Read the rest of this entry »

BBB of Southern Arizona is warning of a new “Tech Support Scam” that involves telephone scammers calling consumers, and offering to help them remove any viruses that may have infected their computers as a result of the recent BBB email phishing scam.

The criminals who run Tech Support Scams attempt to trick their victims into infecting their own computers with malware, and other viruses, by directing them over the phone to download fraudulent antivirus software online that actually contain only viruses. Once consumers download this software the scammers will attempt to steal sensitive personal information from their computers.

The new scam appears to be a continuation of the recent BBB email phishing scam, where consumers and businesses nationwide received bogus BBB complaint emails urged them to open virus-infected links.

BBB Tips:

• BBB will never call businesses or consumers and offer tech support over the phone
• If your computer was infected by a virus from the BBB email phishing scam use your computers existing antivirus to scan your computer, and if that doesn’t work take your computer to a specialist.
• If you have any questions involving the BBB tech support scam phone calls, or the BBB email phishing scam contact BBB by calling (520)888-5353 or visiting www.tucson.bbb.org.

Gloria Kroske took out a second mortgage on her Dallas, Ore. home in better times. Now, she and her husband are struggling to pay their bills on Social Security. Her husband has found work off and on, but multiple health problems make working difficult and medical bills are piling up.

While the Kroskes are current on their first mortgage, the second mortgage has been neglected and the bank has started the process of foreclosure. In December, they were forced to file bankruptcy in order to keep the home they have owned for 30 years.

Kroske said in a moment of weakness, she called National Auditing, a company based out of Texas that advertises nationally. She paid more than $1,000 for the company’s services, but never got the modification she needed. Once she made the last payment, she said company representatives stopped answering her calls.

“I just needed some help and they said that they did auditing and stuff on these mortgage companies, so I gave them a call,” she said. “It’s called desperate.”

Customers nationwide have turned to Better Business Bureau, state attorneys general and the Federal Trade Commission with similar stories. The FTC has issued multiple warnings about loan modification and forensic audit scams. BBB registered approximately 1,400 complaints against loan modification companies in 2011.

Though Kroske needed a loan modification, which changes the initial terms of the loan to lower payments, National Auditing only provided a forensic audit.

Such an audit reviews the terms of the original loan for errors, and the FTC warned “there is no evidence that forensic loan audits will help you get a loan modification or any other foreclosure relief, even if they’re conducted by a licensed, legitimate and trained auditor, mortgage professional or lawyer.”

Another consumer, Brian Becker, fell for a different tactic. He lost $2,500 when he hired a Florida company to help him modify his mortgage. He said Summit Legal Group called him and the representative claimed the company secured loan modifications for 100 percent of its clients.

“He assured me that the reason (the fee) was high was they had 100 percent approval rate,” Becker said. “If — for any reason at all — they couldn’t do it, I would get a full refund.”

He said he researched Summit Legal Group online and did not find any negative reviews or hints that there might be trouble. He had researched loan modifications and knew there were restrictions on who could provide such services.

“I thought I was doing my homework here,” he said. “So, I figured OK, I’m doing the right thing going with a law firm.”

He hired Summit Legal Group and paid the $2,500 fee. After not hearing anything for months, a representative from the company called him asking for more money. At that point, he said he knew he Read the rest of this entry »