The Palo Alto Police Department has received several reports from residents where the suspects falsely represent themselves as employees from the IRS. This scam is occurring nationally and is not unique to Palo Alto. The suspects tell residents that they owe money to the IRS, and that it must be paid immediately through a pre-loaded debit card or wire transfer. If the victim refuses to cooperate, the suspects threaten to arrest them. In many cases, the suspects become hostile and insulting.
Scammers have used fake names and badge numbers. In an effort to convince business owners they are legitimately from the IRS, they have used commercially available products on the Internet to display the IRS toll-free telephone number or a Washington D.C. area code. Another tactic the suspects use is to send the victim a fake arrest warrant with their name on it.
If you receive a telephone call from someone claiming to represent the IRS, we suggest taking the following steps:
If you know you owe taxes or you think you might owe taxes, call the IRS at 800-829-1040. The IRS employees can help you with a payment issue. If there is no payment issue, they will be able to let you know.
If you know you do not owe taxes or have no reason to think that you owe any taxes (for example, you've never received a bill from the IRS, or the caller made threats as described above), then call and report the incident to the Treasury Inspector General for Tax Administration via their website at http://www.treasury.gov/tigta/contact_report_scam.shtml. They are the lead agency for investigating this scam.