How Social Security Scammers Tried to Swindle a Fraud Expert
Here’s how fraudsters try to trick you into handing over your cash
By Doug Shadel, AARP, March 22, 2019
Among the hottest telephone scams in the United States right now is the “Someone Stole Your Social Security Number” ploy. This past December the Federal Trade Commission issued a warning about the fraud, noting the agency had already received more than 35,000 complaints, and my colleagues at the AARP Fraud Watch Network say complaints continue to come in. The scam typically starts with a robo-call like this one:
This call is regarding an enforcement action which has been executed by the U.S. Treasury against your Social Security number. Ignoring this would be an intentional attempt to avoid initial appearances before the magistrate judge for a federal criminal offense. Before this matter goes to federal court or you get arrested, kindly call us back on our number …
I recently received a call like this and decided to dial back to see exactly what the scammers say to get people to hand over their money. My persona was “Carl Johnson,” a kindly, soft-spoken gentleman who happens to have plenty of savings. Here’s what happened over 46 minutes of phone conversation (edited for clarity and length):
“Hello, Social Security Administration. Officer Alex Morgan speaking. How can I help you?
“This is Carl Johnson. I got a call about my Social Security card.”
Officer Morgan sounded like a male between the ages of 22 and 32. He was clearly in a boiler room because I could hear several others talking in the background. He began by asking me to verify my identity. I gave him my fake name; somehow, he was able to pull up my “file” on his computer immediately. I then gave him a fake home address and fake Social Security number, but he pressed ahead as if all was confirmed.
“Mr. Johnson, I’m a senior officer in the investigation department of the Social Security Administration,” he told me. “I can see that law enforcement agencies have found more than 25 stolen bank accounts opened using your Social Security number to commit a fraud of more than $10 million. These accounts were used in numerous criminal activities like money laundering, drug trafficking and for Internal Revenue Service type tax scams all over the state of Texas. I need to ask you a quick question for which you need to reply with one word: Do you own all these 25 bank accounts, Mr. Johnson? Yes or no?”
It was an absurd but effective question, meant to create fear and confusion.“I — I don’t know — I didn’t think I had that many, but maybe I do,” I muttered.
Officer Morgan, smelling potential, worked to reel me in further. He explained that scammers had gotten ahold of my Social Security number, but he would help me sort it out. To do that, he needed to know exactly how much money I had.
“Please tell me the names of the bank accounts that are owned by you and how much is in each account so I can determine which are your accounts and which are fake. And make sure you don’t tell me the routing number or account number — if you do, that will be illegal.”
I told him I had two accounts (again, both fake) — a Chase account with $12,000 in it and a Wells Fargo account with $85,000 in it. In the con artist world, these amounts officially made me a “whale” — someone with enough money to warrant their highest level of attention.
So Officer Morgan shifted to attack mode, doing everything he could to frighten me further. He ticked off a crazily long list of crimes linked to my card, then informed me that there were 11 federal counts of fraud charged against me. If convicted, I would face 30 years of prison time. The FBI was about to issue a “non-bail able” arrest warrant for me; after my arrest, all of my bank accounts, credit cards, debit cards, 401(k) plan, passport and Social Security check would be suspended.
Then he asked: “Do you accept all of these allegations under your name?”
Another absurd, disorienting question. “Well, I — I — I don’t know what to do,” I said.
“Now listen to me very carefully,” he said, more kindly. “We have been keeping a close watch on you and after going over your past reports, we believe this might not have been done by you. … We don’t have any evidence that you performed criminal activity. But since your Social Security number came under this drug trafficking case, we need you to cooperate with us in finding that person.”
Going from threatening to being my best pal also is right out of the swindler’s playbook. A primary objective of all scammers is to get the victim “under the ether” — slang for a heightened emotional state where the victim no longer is thinking rationally but rather is reacting emotionally out of fear or excitement. Victims who are under the ether are significantly easier to manipulate.
“Right now, you have two simple options, Mr. Johnson,” he continued. Either I could let the case play out and “accept legal actions,” or I could give him the phone number for Social Security so he could call over and start the process of clearing my name. Huh? I of course chose the second option, but asked why I needed to give him the number when he worked at the place. He said it was so I could be certain that the person who called me next really was from Social Security because “there are a lot of scams out there, Mr. Johnson, and I wouldn’t want you to fall for one of them.”
After some initial banter, he got to business: “If you want to prove you’re innocent, the very first thing I will have to do is issue a new Social Security number.” But to do that, he said, all my financial accounts would have to be “safeguarded” first so criminals couldn’t access them. Then the pressure got turned up: “The government is providing you 40 to 45 minutes time to resolve this matter. So can you confirm that in your Chase banking account you have $12,000 and in your Wells Fargo account you have $85,000? Is that correct?”
“Yes, but—” I blurted out trying to slow him down. But he seemed to actually speed up.
“What you have to do is go to your bank and withdraw all the money from your account as cash, then I will let you know what you will do next. I want you to go to the Chase bank account and withdraw that money. “
“Right now?” I asked.
“Right now, yes. Because we want to safeguard your money first. That is the reason.”
“I don’t know if I want to give you my money.”
“Oh, no, who told you that you were giving me your money? You are not going to give your money to anyone, Mr. Johnson. If you have that thing in your mind, please take that out of your mind. No. No one is asking for money from you and you are not paying the money to anyone.”
He repeated this a few times, in a few different ways, to reassure me. I asked, “Why can’t I just put the money into a new bank account?”
“Well, Mr. Johnson, if you open a new bank account you will be linking the same Social Security card number that you have right now, am I correct?”
“Yeah, I guess so,” I conceded.
“That is the problem.”
His instructions: Withdraw $12,000 from my Chase account immediately and convert it to “government-certified bonds” so I would not lose it to the criminal who stole my Social Security number. What did he mean by “government-certified bonds”?
“These are prepaid cards that are available in government-certified stores like Apple stores, Walmart, Target, CVS, and Walgreens. These are government-certified stores, I believe you know that, right?”
At this point, I’m starting to get mad: How many thousands of older people had he and guys like him persuaded to take out their life savings and buy prepaid debit cards? But I stayed with it. He reassured me again that I was supposed to hold onto those cards until they issued a new Social Security card. I asked Shaw, “Do I give you the ‘government-certified bonds’?”
“No. You hang onto the bonds. That is my whole point. They will never leave your possession and so you have nothing to worry about. If they never leave your hands, then you cannot ever lose that money, am I right, Mr. Johnson? In fact, it is protected. After you convert the cash to government-certified bonds, two representatives from Social Security will come to your doorstep in 48 hours to hand-deliver your new Social Security card. Then you can open new accounts and redeposit the bonds into your bank account.”
Okay — well, that is persuasive. But then came the bomb:
“Now, once you get the government-certified bonds, you just have to provide us the serial numbers so we can make sure we can update that on your file.”
And that’s how they steal your money, ladies and gentlemen. With the serial number, they are free to withdraw the money and disappear. This is the point where I changed personas from Carl Johnson, easy target, to Doug Shadel, fraud fighter.
“Doesn’t that give you access to all the money that is on those cards?”
He of course lied in response. “No! We are not going to need to access the funds. We just need the serial numbers to update your files. Those are yours and they are safeguarded. The whole point of putting the money on those government-issued bonds is to safeguard them, so no, nothing will happen to the money. You have my word on that, Mr. Johnson.” Angry, but with all my questions answered, I simply ended the call.
Mr. Shaw called me back more than a dozen times, but I didn’t answer. When the goal is over $80,000 in potential cash, expert crooks like Mr. Shaw will say anything to win you over. I didn’t need to hear any more.