United States: "W-2 Phishing Attacks Targeting Businesses to Cash in on Busy Tax Season: 10 Tips to Protect Your Business"

Last Updated: March 9 2017
Article by Cinthia Motley and Nora B. Wetzel

Cyber criminals are taking advantage of tax season to lure valuable W-2 information from vulnerable businesses. An example of a common phishing scheme starts with a scammer posing as a legitimate employee of a company, sending an email that looks like it is coming from an internal email address, often the Human Resources department or the Finance department, or even from the CEO of the company. A cyber criminal may even impersonate an employee using stolen personal data from that employee. The email from the scammer attempts to trick the recipient into sending the scammer W-2's, often creating a sense of urgency for a quick response. As we all know, a W-2 contains valuable information such as an individual's name, address, social security number, salary and withheld taxes. Cyber criminals can use this information to file fake tax returns and pocket tax refunds.

As recently as February 17, 2017, the IRS warned of a new phishing scam where tax professionals and state tax agencies are sent an email impersonating a software provider with the subject line "Access Locked." The email tells the recipient that access to the software was suspended due to errors in the recipient's security details. Then, the email requires the recipient to "unlock" the software by clicking on a link that directs the recipient to a fake web page, prompting the recipient to provide his/her user name and password, which is used by the scammer to steal client information. https://www.irs.gov/uac/newsroom/security-summit-alert-tax-professionals-warned-of-new-scam-to-unlock-their-tax-software-accounts

Other common ways phishing attacks occur are by: (1) embedding a link in an email that redirects the recipient to an unsecured website that asks for sensitive personal information, (2) including with an email a malicious attachment or ad that allows an intruder to use loopholes in security to obtain personal information, or (3) impersonating a known vendor or an employee over the telephone to obtain company information.

We offer some tips to help prevent succumbing to W-2 phishing attacks that are already plaguing this tax season:

  1. Pick up the phone: If you receive an email asking for a W-2 or hear of someone in your company receiving such an email, verify the authenticity of the request. A simple solution is to pick up the telephone and call the apparent author of the email to ask if he/she indeed asked for a W-2. The same rule of thumb should apply if you receive an email asking for a money transfer or other sensitive information.
  2. Check the sender's email address for discrepancies: Often an email address from a scammer will look almost like a company's internal email address, but there might be a spelling error with one letter off, or a period added or taken away. Scrutinize the email address from a sender asking for W-2s to see if there are any discrepancies that might provide a clue that the email is fake.
  3. Don't just reply, forward instead: Instead of automatically hitting reply to an email from what appears to be a known colleague asking for W-2s or credentials that could be used to obtain W-2s, forward the email to the legitimate email address you have for the person who the email looks like it is coming from and ask she/he to verify if he/she sent the forwarded email.
  4. Redact W-2s: If your business is not required to provide or maintain unredacted W-2s, then redact (black out) all but the last 4 digits of social security numbers on W-2s you generate or maintain. This reduces the sensitive personal information available on the W-2 and makes the W-2s much less valuable if a scammer ever was able to obtain them.
  5. Encrypt W-2s (and all sensitive company information): Even if you cannot redact W-2s, all W-2s and sensitive company information should be encrypted, both at rest and when being transmitted (including in the mobile and "own device" environments).
  6. Train your workforce: Regularly educate and train your workforce on phishing attacks. Test your workforce on the training provided. Phishing attacks work because of human error. Training and testing of your workforce to recognize phishing attacks can greatly reduce the risk of success of a phishing attack.
  7. Implement and maintain strong information security: Ensure that your company has robust spam filters that are regularly updated, block malicious websites, enable browser ad-ons that prevent a user from clicking on malicious links, use antivirus software, and keep all security systems current with updates and patches. Apply all of these security programs to mobile environments and "own devices" to prevent exploitation of vulnerabilities in the mobile environment or from "bring your own device" practices.
  8. Restrict access to W-2 information: Ensure that only key personnel have authority to access personally identifiable information, in this case W-2 tax information. Such access should be restricted to only those who require it to perform their job duties.
  9. Restrict outflow of W-2 information: Restrict internal staff's ability to copy sensitive data into unapproved methods of transmission, such as email and web browsers, including controlling the ability to copy, paste and print sections of documents. Loss prevention endpoint technology and application controls are available in this area.
  10. Implement, practice and update a Data Loss Prevention (DLP) Program: Cyber risks present a fast- evolving landscape. Data loss through cybercrime and internal risks represent increasing business exposures. Prevention is key to mitigation in this area and a better option than facing a breach unprepared. An entity that knows those risks and controls the data that flows within and outside of its walls can best remain competitive in the marketplace. Using this knowledge, a company can most efficiently protect sensitive data and quickly respond to security incidents.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.