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IRS: Scammers taking advantage of new law

The Internal Revenue Service (IRS) is warning foreign banks that scammers are trying to put one over on them when it comes to a new law cracking down on offshore tax evasion.

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In a new alert, the tax agency said Wednesday that fraudsters around the world are posing as the IRS to try to get information about financial accounts or their holders under the Foreign Account Tax Compliance Act, or FATCA.

Under the law, which went into effect in July, foreign banks aren’t required to share that sort of information over the phone or via fax, the IRS stressed Wednesday.

“Tax scams using the IRS name can take many forms and they are not limited by national borders,” John Koskinen, the IRS commissioner, said in a statement. “People should always be cautious before sending sensitive information to anyone.”

Dozens of countries have signed agreements with the IRS to enforce FATCA, and individual banks have also signed up to help. Banks that don’t agree to share information can get hit with a withholding tax. The financial industry has long said the law was a burden.