Legal Thriller Author Warns: Once Tax Season is over a Deadly New Tax Scam Awaits You

--Stop, Think, Before Reaching for that Unexpected Tax Refund--A Con Man's Deadly New Tax Scam Looms

"Hello, allow me to introduce myself. My name is Will Grabitall. I'm calling on behalf of the United States Internal Revenue Service, and I have good news for you." The voice you hear over your phone is firm but cheerful and reassuring. He continues,
"On a re-check of your 2007 tax return we find that you overpaid in the amount of $2,106.84. We will be sending you a refund check in this amount.. But first, I must have some verifying information."

In the 19th Century, con men were actually tarred and feathered and run out of town on a rail. After hearing a pitch like this you should immediately be thinking in terms of: Where's the tar and a chicken to skin?

This scam--a "phishing" expedition, designed only to wring vital personal information from you for identity theft purposes--is also conducted by the con man with email "notification" of such "good fortune."

You would be directed to--what appears to be--an official IRS web site. The bogus site contains interactive web pages and forms similar to those actually used by IRS. Only difference: they have been modified to elicit detailed financial and personal information from you. It's an elaborate dance by the con man. By now, if you don't recognize the Arthur Murray footprints on the floor, it's time for your medication.

At this point you must keep in mind that IRS never asks for any secret access numbers, such as passwords and PIN numbers--for bank, credit card, or other personal accounts over the phone or by email. You only get these requests in face-to-face audits.

So, how do you respond to Mr.. Grabitall?

How about this way?

"I'll be happy to provide you with full information, once I have verified all of this by contacting IRS myself."
Pause, while you listen to this con man's rejoinder, trying to talk you out of this course of action. Then, "No, no, that's quite alright, Mr. Grabitall. I prefer to do this checking myself. If you would be so good as to leave your phone number I will get back to you after I've done so. Thank you for your work on my behalf.

Don't expect to speak to this con man again. Ever. If you did bother to call back, by then he will have disappeared--back under his rock.

Con Artists' Standby--the Quick Way to see through the Phony Invoice Scam

--If con artists were to credit Benjamin Franklin with first pushing the phony invoice scam, it's said they would get better recognition for it.

Some scams appeal to greed (Earn $1,000 a week stuffing envelopes). Some appeal to fear (Cure cancer easy; the cure is in your cupboard). Others to vanity (Become a Cary Grant look-alike in 10 easy steps). But, this one--an ever-popular scam with con artists--plays on inattentiveness, sloppy routine office procedure, and in some cases, downright laziness. It's the phony invoice scam, around for ages, still alive and kicking.

A standby of America's mail order age, the phony invoice scam works something like this: a realistic-looking invoice is mailed to a small business. It's conveyed by way of the usual window envelope, and dressed up to look like any other invoice that businesses receive on a daily basis. It has an itemized list of services supposedly rendered, or products supposedly delivered. If the accountant or purchasing agent (whichever responsible for paying bills) were to flip to the reverse side and read through the terms--printed purposely in tiny, eye-straining type, and in dull, sleep-provoking language--they would find, near the bottom, a brief disclaimer, "This is not an invoice." Few ever get that far, because it reads like an income tax form that has been modified beyond all understanding.

If the dollar amount is small, it's so much easier to just pay the bill and have done with it. What's the rationale? Quick, no hassle, easy way? Who knows. Don't hate yourself in the morning, sleep till noon. something like that.

The con artists are fully aware of this nonchalant, gloss-over scrutiny and tailor their operations accordingly. They are also fully aware that most businesses have a "do not contest" policy--presumably for faster, more efficient internal operating procedure--wherein, if the dollar amount does not exceed a certain figure, it need not be held up for further approval, O.K.'d by another person, or investigated. The scamsters know these dollar limits usually range from "not more than $25," "not more than $100," or cut-off-for-examination points in-between.

They therefore usually take the easy way themselves and set the amount they will charge at $24 and change. Then, after mailing tens of thousands of these, they sit back and total up their returns as their business reply envelopes come flooding back with the anticipated payments. Then, it's the ca-ching, ca-ching, ca-ching ringing of their cash resisters that makes them work, as well as their frequent trips to the bank (we wonder, do you think they really laugh all the way?) to deposit their "ill-gotten gains."

As further indication of how rewarding this scam is, consider this hypothetical: Say the con artist sends out 100,000 of these "invoices," and gets but an anemic 1% return. Even that low a rate of return spells out to 1.000 suckers paying for nothing at the rate of $25 each. This would come to a quick $25,000, not bad for a day's work. In the past these schemes have yielded a return as high as 7%. We think you will agree, that $175,000 for a day's work, from a scam of this scale, would buy groceries for a while.

So many of the scam fighters today are so distracted by the more exotic forms of fraud that they largely leave this one alone. To each his own, we guess. We say, if you don't want to beat a dead horse, then don't beat a dead horse. It's as simple as that But, unless one is certifiably insane he will instantly see that this is one of the easiest problems to fix. Thus, we say, also in the "as simple as that" vein, O.K. then, fix it...

Legal Con-Man-Made Mortgage Crisis--Careful it does not Gobble You Up

--House Flippers have no Bill of Rights--Neither do you if you are Caught up in the Mortgage "Reset" Tide

You are not a house flipper--one who buys "fixer-upper" houses, does that, and resells for profit. You need a mortgage to secure purchase of your dream home--for yourself and family, to live in, happily ever after. You visit a mortgage broker to help you put the vital financial link into place. The fact that you find yourself talking to a 22-year old, sporting lip, nose and ear rings, is somewhat upsetting, but your urgency makes you look past this--as well as the jeans and halter top he is wearing which only partially cover the plentiful tattoos.

Your needs propel you. You ride right on past the flashing red lights and alarm bells ringing out at you, shouting think, think. slow down, stop, stop. You ignore such ominous signs as the January slump of 11% in U.S. home prices, a record 1-month drop, swallowing up home owners' equity, and the collapse of the 5th largest investment bank in the country, Bear, Stearns

You get the mortgage, which is adjustable rate--meaning your initial monthly payments of $1,500 quickly jump to $2,200 once the trip wire--follow-inflation clause in the contract--is sprung. You are not a happy camper. You now feel that your choice of a mortgage broker was about as wise as picking an expert on bomb demolition with the stature of a Rosie O'Donnell.

Most home buyers think the mortgage broker represents them. Wrong. Except for California, In every other US. State representation is unclear and not articulated. In fact, many financial institutions recruit mortgage brokers to steer loans to them. Thus, you could say the mortgage broker more closely represents the financial institution involved.
When this realization fully hits you it is about as shocking (as we've said before) as picking up a vintage copy of the Saturday Evening Post with a cover picture of Norman Rockwell beating up a child.

This past year--the year of the real estate market collapse--has been dominated by a process: These new-era mortgage brokers have been steering borrowers with weak credit into "reset" loans--like the trip-wire action you incurred when your monthly payment was blown from $1,500 to $2,200. Now, here's the kicker. It's buried in the fine print you didn't read when you signed on: These ARMs (Adjustable Rate Mortgages) carry steep penalties if the borrower tries to pay off the loan before it resets. This is the "trap." This clause makes it near-impossible for you to pay off the loan before it shifts to punishing high interest Docility is the name of this game, and lenders everywhere are fully aware of it. Legalese strung throughout the contract wins the day, leading to widespread neglect and / or misunderstanding. Mortgage Brokers and Home Lenders are fully aware of Murphy's Law: The more crap you put up with, the more crap you are going to get. Thus, they pile on, feed the fires accordingly and relentlessly.

Hence, multiply this scenario--this "trap"--by 1,500,000 or more cases of home owners about to be foreclosed upon, and, voila, you have the makings of a market panic. It's this kind of "drive by" lending that has paved the way for the real estate calamity we face today--a market mess so bad that it is threatening to pull down our entire economy and throw us all into recession.

Ethical, no, but, legal business dealings? Yes, technically. Even though such dealings seem to be along the lines of Canada Bill Johne's Motto: It's morally wrong to allow suckers to keep their money.

Legal Con Man Tactics Used in Flood of Frivolous Law Suits

--Awash in Law Suits, American Court System Struggling to get out from Under

Magalia, California--A sue-happy America has unleashed a tidal wave of law suits on its court system. Once called, "frivolous," many of these are now being won by plaintiffs, some with eye-popping jury awards. At risk are not only deep-pockets defendants, but struggling small business persons of every ilk. people who can ill-afford such legal attacks.

A random sampling:

A West Virginia convenience store worker receives a jury award of $3,000,000 when she injures her back while opening a jar of pickles.

Suit brought against a Las Vegas casino by a California man claiming the casino was negligent in permitting him to gamble away $1,000,000 while he was drunk.

Passengers sue American Airlines for the "emotional impact" of 28 seconds of turbulent weather on a flight from Los Angeles to New York. A jury awards them $2,000,000.

The manufacturer of Louisville slugger baseball bats is sued for $1,000,000 as the result of a ball hit with one of its bats bouncing off the head of a player.

A mother, rushed to a hospital emergency room, caused her 2 daughters so much trauma that they sue the hospital--not for their mother's treatment--for the emotional stress this caused them.

A 420-pound man sues McDonald's for employment discrimination. for not hiring him. Federal judge lets trial stand.

A Missouri woman wins $6,000 from a beauty salon for emotional stress and early retirement caused by a bad hair treatment.

Four women sue a California seafood restaurant for emotional stress, and subsequent psychiatrist visits, when one of them bites into a condom in a cup of clam chowder.

A volunteer, unpaid little league baseball coach,a street-maintenance worker, is sued for $2,000 by the father of the team's catcher. The complaint? Poor coaching.

With shades of con man tactics, such law suits are proliferating as America's law schools let loose a flood of new lawyers on its citizenry, many of them relishing in praying on the economic system in general. Canada, too has suffered from this con-man type plague which seemingly grows on its populace like a colony of E Coli bacteria attacking a slab of choice Canadian beef, critics say.

Jack Payne, author of 55 business books, wraps up the subject this way, "The only hope for all the unfortunate defendants seems to be to subscribe to, and believe in, the Law of Bureaucracy: The second myth of management efficiency is that skill equals success," he says. "Often it does not.. This seems about the last hope in erecting a con-man-resistant shield against these abuses of the system.""

Yada, Yada, Yada--Blah, Blah, Blah

--Epitaph on Your Tombstone will include 2 Dates, with a Dash between them Representing your Life--This is a Study of the Dash

If each day you wake up to the sharp realities of morning, with the belief that things will get better--and end the day going to an outdoor party that features cheap wine and barbequed Spam, you know something went wrong in between.

What are some of these things that go damnably wrong, daily--with maddening regularity--much of it spawned by the con man world in which we live? We're getting to it. Hang with us.

But, first, for stage setting, consider this:
You've graduated with honors from college. You've been fine-tuned to the expectations of an idealistic working career experience, including all applicable Golden Rule observances.

You get a job. You are now told that your employer's company thrives on interconnectedness, diversity, free exchange of ideas and opinion--is one big happy family.

Yada, yada, yada. Blah, blah, blah.

Now, on to reality...

In contrast you quickly find that all bad policies are more likely to be supplemented than repealed. You learn that the perfect candidate for any job will show up shortly after the position is filled. After things have gone from bad to worse the cycle will repeat itself. After all is said and done a lot more will be said than done.

Further, the inconsistencies with your education now jump out at you. You begin to wonder why closed minds and open mouths seem to go together. Starting with Sturgeon's First Law--90% of everything is bull--you become aware of the many Laws of Bureaucracy which dominate your working environment: Nothing is ever accomplished by being reasonable. Rules grow at about the same speed as weeds.
There's always one person who knows what's going on; this person quits, retires, or is fired. All's well that creates more work. Catalog all details; never mind facts. Management's decision, "Maybe" is always final. The first myth of management efficiency is that it exists.

Yada, yada, yada. Blah, blah, blah.

You see a political ad on TV. In it, Senator Pothole, running for President, ignores al Qaeda, Iran, North Korea, and Hugo Chavez as threats to all of us. Instead he singles "you" out, as an individual, and dramatically proclaims that it is "you" he is fighting for. He sternly warns that your most feared menaces--from which you will gain his protection, if elected--are Corporate America, Big Oil, Big Pharmaceuticals, incandescent light bulbs, and Wal-Mart. At this point a background voiceover kicks in to alert you as to the shortcomings of Senator Pothole's opponent. From hushed, conspiratorial-sounding intonations you learn that this unworthy opponent is a Child Molester / Drug Dealer / Wife Beater / Pimp, who is, tragically, beyond rehabilitation.

Yada, yada, yada. Blah, blah, blah.

Your last credit card payment arrives at its destination office one day late. Your APR is kicked from 18% to 35%. This doubling, you are told, is due to your slippage to a new higher-risk credit category. The incongruity of this makes you feel like a roosting, migrant bird that has lost its homing instincts, caught in a dream of perpetual, static flight.

Yada, yada, yada. Blah, blah, blah.

You pick up a newspaper, leaf through it, browse the headlines (taken from actual newspaper headlines): Something went wrong in Jet Crash, Experts Say. Miners Refuse to work After Death. Killer Sentenced to Die for Second Time in 10 years. If Strike isn't Settled Quickly, it May Last Awhile. Red Tape Holds Up New Bridge. Sex Education Delayed; Teachers Request Training. War dims Hopes for Peace.

You scratch your head in disbelief.
You wonder: Are newspaper headline writers con artists too?

Yada, yada, yada. Blah, blah, blah.

You now realize that so much of what you hear daily is from people who would have you believe the world is flat, Santa Clause, the Easter Bunny, and Tooth Fairy exist, and there is such a thing as an honest politician. And, much of this spin twirled at you is seemingly coming from a skilled diplomat who can tell you where to go in such a way that you look forward to the trip. Puzzled, you ask yourself: Is road kill really a gourmet meal?

As things end up you can only wonder at this incomrehensible menu of unresolved, childlike prattle you have to put up with.

Jeanie, Jeanie, eats zuchini. Peter, Peter, pumpkin eater.

When in doubt, mumble.

Yada, yada, yada. Blah, blah, blah.

Con Artists' Newest Trick: Make Victims Part of the Scam--Are You Included?

--Have these Con Artists come up with the Perfect Scam? Here's how it is Put Together

Magalia, California--When in doubt, make your victims part of the crime. This appears to be the newest strategy of con artists. Their rationale? Seemingly it is: Why not? Can one think of a better way to buy silence?

It works this way:

Innocent shopper spots a high-end, expensive item on an internet site, a lap top computer which retails for $3,000. Seller offers to sell for $1,300. Upon getting inquiry from innocent shopper, seller (read, con artist) offers to ship the lap top, no questions asked. No upfront money is required either--only a promise to return it, or wire payment within 48 hours.

Too good to be true?

No. Not quite. Ignorance is no excuse; it's the real thing, it's said. Here's what happens next:

Using the home address and the information provided by innocent shopper, con man, using a stolen credit card number, orders the lap top at the full $3,000 retail price and has it drop-shipped, directly to innocent shopper.

No one is listening till you make a mistake, it so often seems. Innocent shopper, happy with the product, wires $1,300 payment, leaving himself the receiver of stolen property. In addition, another anonymous victim has a fraudulent charge on his / her credit card. And, a merchant has delivered stolen goods.

One product. Repeat orders to fill. Inclusion of everybody involved in the scam itself. What could be sweeter than this for the con artist? The FBI and several European police authorities currently have their hands full trying to crack down on this near-foolproof scam. Trouble they are having is getting enough innocent victims to come forward.

"If you want something to validate your inherent mistrust of strangers, this should be it," says legal thriller author, Jack Payne. "Al Capone's business card said he was a used furniture dealer. Something like this should be the first clue."

Tax Time Scams--How to keep I.R.S. from Knocking on Your Door

--Amateur Tax Cheats Going Berserk with Looney Tunes Tax Filings--Don't Make these Mistakes

Tax time puts the Law of Argument in the spotlight: Anything is possible if you don't know what you're talking about. If you need a match and a cup of gasoline, aimless tax cheating might qualify you for such playthings.

So many of the excuses so many taxpayers use at filing time to avoid paying taxes are totally absurd. They are not only plentiful, but unbelievable, child-like. If they are in training to become a professional con man, they have failed miserably. In prison you spend most of your time in an 8 x 10 cell; at work you spend most of your time in a 6 x 8 cubicle. Maybe these people are trying, in some warped way, to upgrade their lifestyle. Here are some examples of their attempts to qualify:

> The filing of a tax return, and payment of taxes are "voluntary," is the claim. Wrong. You don't say this to IRS any more than you would say to a feminist, "Isn't that cute?" Voluntary only refers to the individual's rights to put the figures together. The right to file, and pay, is definitely involuntary. To the point of a pounding drum beat, courts have repeatedly told us this.

> The filing of a zero return, entering the figure 0 on every line. Some taxpayers even go so far as to request a refund of their taxes withheld. Insanity? At times it seems reality is a crutch for people who can't handle drugs. This doesn't even have the first raw rudiments of a legal scam.

> Contention: Section 6020(6) of the tax code requires the IRS to prepare a federal tax return for any person who does not file. Another nutty, unimaginative argument. (Everybody is somebody else's weirdo.) Oh, if you don't file, IRS will file for you alright. They will gather the figures on compensation, and tax you on the entire gross amount. No split-out gross / adjustable gross / net income figures here.

> Some actually assert that wages, tips, and other compensation received for personal services rendered are not income--because, get this, there is no taxable gain when a person "exchanges" labor for money. This "reasoning" is like trying to figure why a woman can't apply mascara with her mouth closed. Still another head-scratcher.

> Federal Reserve Notes are not money. Why? Because they cannot be exchanged for gold or silver. How about wampum?

> Some claim they have rejected U.S. citizenship in favor of state citizenship, thereby freeing themselves of all obligations to pay federal taxes. Easy way out, huh? After all, there is no recorded case of an ostrich ever having died of suffocation from burying its head in the sand.

> Some even go so far as to claim that the United States consists only of the District of Columbia, federal territories, e.g. Puerto Rico, Guam, etc., and federal enclaves such as Indian reservations and military bases; therefore non-residents of these enclaves are tax exempt. Dreamers, dreamers, dreamers. (Never give yourself a haircut after 3 Martinis.)

Some mistakes are too much fun to only make once? Is that the driving motivation?
Real people. Real thought processes. But, you must ask, are these people all living in the real world?