NEWARK, N.J. (CBSNewYork) — U.S. Sen. Robert Mendendez is concerned that a federal proposal could make life easier for scammers.
A provision in the federal budget deal would allow federal agencies and third-party companies to place phone calls to people to collect debt, WCBS 880’s Kelly Waldron reported.
The loophole also allows pre-recorded voice mail messages and text messages to your cell phone to collect money.
At a news conference Monday in Newark, Menendez, D-N.J., noted that con artists have increasingly been placing calls while claiming to be the Internal Revenue Service and threatening legal action, fines, jail time and even deportation if payments are not promptly made.
IRS scams like these have recently cost residents in Linden and Leonia more than one million dollars, according to local police, CBS2’s Elise Finch reported.
“They’re sending in money in fear to people who are scamming them,” Menendez told 1010 WINS.
More than 700,000 people have fallen victim to the IRS scam since October 2013, the senator said.
“Taxpayers have lost about $23 million to these scams,” Menendez said.
He has sponsored a measure that would kill the provision.
“It blurs the line between what is legit and what is a complete and utter fraud,” Menendez said of the provision.
Prior to the new provision, debt collectors couldn’t make robo-calls to your cell phone without your permission. Some local residents were not pleased with what debt collection calls could mean.
“It just reminds you constantly that you’re in debt that you have student loans to pay off,” Sandra Komar, of Hoboken, said.
The scammers generally request payments using prepaid debit cards because they are harder to trace than bank cards.
Real IRS agents usually contact people first by mail, officials say. And they never demand payment by debit card, credit card or wire transfer.