Accounting Firm Says Clients May Be Victims of Tax Scam – Business Journal Daily

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HERMITAGE, Pa. – Reed & Dailey, an accounting and income tax firm based here, says it’s hasn’t identified any “bad guys,” but it is “actively investigating” if and how its systems were compromised and confidential client information stolen.

Red flags were raised when the firm noticed that certain tax returns it filed were rejected by the Internal Revenue Service as duplicate filings. Some of these clients subsequently “reported attempts of unauthorized access to their bank account,” Reed & Dailey said.

Banks were notified of the possible breaches as well as the Internal Revenue Service and the FBI.

Tax returns rejected as duplicates can occur when another person tries to file an unauthorized return using the taxpayer’s personal information.

“We are not aware of any clients suffering an actual financial loss at this time,” the firm said, adding it has no reason to believe any of its employees were involved in the potential breach.

A three-page Q&A “media response” was released Saturday to The Business Journal in connection with a story – “Tax scam may have targeted clients of Hermitage firm” — reported Friday by the Sharon Herald.

“We became aware of a pattern of rejections starting around Feb. 21,” the release began. “The pattern escalated for a while and has since receded. We have provided up-to-date notifications of the e-filing rejections to clients, as we are notified,

“In accordance with IRS regulations, we notified the IRS immediately of our concerns. We were referred to a special unit of the IRS, which is highly experienced in these matters. We provided them with a list of ID numbers of previous 2020 clients that we e-filed tax returns for. The IRS unit currently has those ID numbers on file to attempt to prevent unauthorized filings for those on the list, Reed & Dailey said.

It remains unknown whether the unauthorized tax returns were filed based on information obtained from its systems or elsewhere, according to the response. “There are many parties involved in data systems — like software vendors, firewall providers, IT firms, anti-virus providers, and transmission entities,” the firm said.

“We have, of course, taken yet additional steps to secure our information systems. In addition to our IT firms, firewalls and anti-virus software programs, we have engaged cyber security specialists to help ensure that our systems are more contained from any potential threats.”
Reed & Dailey concluded its press release by praising its clients for being “nothing but gracious and patient. It’s just another example of our fabulous community that we live in. The good people outweigh the bad by the widest measure possible.”

Copyright 2022 The Business Journal, Youngstown, Ohio.



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