The Internal Revenue Service issued an alert about an emerging phishing email scheme that purports to be from company executives and requests personal information on employees.

The IRS has learned this scheme – part of the surge in phishing emails seen this year – already has claimed several victims as payroll and human resources offices mistakenly email payroll data including Forms W-2 that contain Social Security numbers and other personally identifiable information to cybercriminals posing as company executives.

“This is a new twist on an old scheme using the cover of the tax season and W-2 filings to try tricking people into sharing personal data. Now the criminals are focusing their schemes on company payroll departments,” said IRS Commissioner John Koskinen. “If your CEO appears to be emailing you for a list of company employees, check it out before you respond. Everyone has a responsibility to remain diligent about confirming the identity of people requesting personal information about employees.”

IRS Criminal Investigation already is reviewing several cases in which people have been tricked into sharing SSNs with what turned out to be cybercriminals. Criminals using personal information stolen elsewhere seek to monetize data, including by filing fraudulent tax returns for refunds.

This phishing variation is known as a “spoofing” email. It will contain, for example, the actual name of the company chief executive officer. In this variation, the “CEO” sends an email to a company payroll office employee and requests a list of employees and information including SSNs.

The following are some of the details contained in the e-mails:

• Kindly send me the individual 2015 W-2 (PDF) and earnings summary of all W-2 of our company staff for a quick review.
• Can you send me the updated list of employees with full details (Name, Social Security Number, Date of Birth, Home Address, Salary) as at 2/2/2016.
• I want you to send me the list of W-2 copy of employees wage and tax statement for 2015, I need them in PDF file type, you can send it as an attachment. Kindly prepare the lists and email them to me asap.

The IRS recently renewed a wider consumer alert for email schemes after seeing an approximate 400 percent surge in phishing and malware incidents so far this tax season and other reports of scams targeting others in a wider tax community.

The emails are designed to trick taxpayers into thinking these are official communications from the IRS or others in the tax industry, including tax software companies. The phishing schemes can ask taxpayers about a wide range of topics. Emails can seek information related to refunds, filing status, confirming personal information, ordering transcripts and verifying PIN information.

Consider taking the following steps to help prevent a data breach of your employee tax records:

1) If you receive a request from an executive to email large quanitities of employee information, verify that request by telephone before responding. 
2) If the request appears legitimate, suggest that the data not be transmitted by email.  
3) If you need to transmit tax information by email, encrypt the document before sending it.
4) Never use a formulaic or easy-to-guess password for an encrypted file (e.g. employee's last name).
5) If you have fallen victim to email phishing, talk to your outside counsel about notification requirements and whether it makes sense to provide employees with credit monitoring services.

The following provides a snapshot of information regarding phishing scams.

 [1] https://www.irs.gov/uac/Newsroom/Consumers-Warned-of-New-Surge-in-IRS-Email-Schemes-during-2016-Tax-Season-Tax-Industry-Also-Targeted

[2] Id.