70 Arrested by Indian Police for Tax Scam Targeting Americans

Dec 07, 2016

At the beginning of October, reports began to surface that Indian police had raided a series of call centers, arrested at least 70 individuals and were questioning hundreds. According to The Associated Press, the chargers were extortion, impersonation and information technology crimes. And the target? Americans.

Employees at the call center allegedly sent out thousands of calls and messages every day. So far in the investigation, it’s believed that these scammers collectively netted as much as $150,000 each day. These individuals would pose as U.S. tax collectors, threatening to involve American authorities if the payment was not promptly made. Other victims were directed to purchase specific gift cards for the purpose of transferring funds through card identification, rather than direct payments.

In a statement to the country’s Economic Times, the police commissioner of Thane, India, Param Bir Singh, said that “In one case, one of the victims shelled out $60,000 just to escape a so-called raid on his house by taxmen”. Bir Singh also stated that the amount stolen was “mind-boggling”, and that the current investigation “could be the tip of the iceberg”.

The police commissioner went on the explain how the fraud ring pulled off their massive scam. He says the accused obtained the toll number of the Internal Revenue Service (IRS) so that, when calls were made, the call identification for the IRS would show up on the victim’s phone.

According to the Indian media outlets, a call center employee may be responsible for alerting local authorities. After receiving the tip, the local police raided office buildings near the city of Mumbai. Hundreds of pieces of equipment, including hard disks and servers, were seized during the raid. Since then, U.S. authorities have contacted the Indian police departments and are now working together to investigate the scam.

American citizens are not the only victims of scams like this. Small businesses can easily fall victim to fraud, and to what is known as “friendly fraud”. Friendly fraud, or chargeback fraud, occurs when a consumer makes an online shopping purchase with their credit card and then requests a chargeback from their issuing bank. After, the cancellation, the consumer receives a refund. According to Visa, online merchants lost $11.8 billion to cases of friendly fraud in 2012.

According to Inc., a study conducted last year by Trustev, an e-commerce anti-fraud company, found that “17 percent of American consumers have disputed charges without contacting the online merchant. The scarier fact of the 1,000-person study was that 5.1 percent of those people admitted to deliberate chargebacks, with more than 20 percent saying that it ‘didn’t bother them very much’ or that it was ‘OK.’”

Fraud is crippling for both individuals and businesses; its negative affects unfortunately affecting both the short-term and long-term. Starting a business, for example, can be shut down because banks refuse to provide services to you. You become “too risky”. Thankfully, high risk specialists – like eMerchantBroker – are happy to work with merchants struggling with bad credit. The credit repair merchant account, for example, is specifically tailored to meet the needs of merchants dealing with this issue. While it can be devastating, overcoming the aftermath of falling victim to fraud is possible.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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