We live in an era where technology can be easily used to falsify documents, especially in documents like a W2 form. Without needing advanced skills, anyone can manipulate data to make it look legitimate in just a few clicks. A fake W2 form occurs when individuals illegally alter or create an entirely new one to gain benefits they shouldn’t.
Falling for a fake W2 form can cause major problems, business-wise, from financial loss to reputational damage. That’s why having an effective way to verify documents is important to keeping your business safe. In this article, explore what you need to be aware of and the best way for prevention.
About Form W2
Form W2 refers to the Wage and Tax Statement. Employers use this document to report the income earned and tax withholdings of each employee. As it contains crucial financial information, a W2 is also considered proof of income and employment, and is commonly required when applying for loans or mortgages.
Fraud Case Examples
In most cases, a fake W2 form often targets financial institutions or government systems, such as:
- Loan Underwriting
As part of a loan application, a fraudulent W2 form is submitted to trick lenders about the applicant’s income. Once they successfully pass the check and secure the loan, they disappear without making any repayments.
- Tax Return Filling
A bad actor files a tax return using fake W2 information to claim bigger refunds than they’re actually supposed to get. These fake tax schemes are often part of larger identity theft scams targeting the IRS tax system.
Things to watch for
To spot a fake W2 form, it’s important to stay alert and look closely at every detail. Here are several signs of it you can watch out for:
- Invalid or incorrectly formatted Employer Identification Number (EIN)
- Non-existent employer name and address
- Unmatched salary amount with other supporting documents such as pay stubs.
- Unusually high salary that does not align with current standard wages for the type of job
- Too perfectly rounded numbers
- Inconsistent fonts used within the same page
- Unusual document sources that can be checked through file metadata
Ways to check if W2 is real or fake
1. Physical Identification
Taking a close look at the visual appearance of the W2 form is one way to check its authenticity. Check if the layout and font format match the standard. Although this method can help, it is very limited and still requires further examination for more accurate results.
2. Document Verification
Verify the legality of the data in the W2 form using external information. For example, check the validity of the EIN (Employer Identification Number), the existence of the listed employer, and cross-reference it with data from other relevant documents. If necessary, confirm with any involved parties to make sure.
3. Document Fraud Detection
As technology advances, document forgery becomes harder to detect. Using fraud detection tools is a modern tech solution to analyze the digital aspects of a document. These tools has a number of cutting-edge metrics to detect signs of manipulation, edits, and examine file metadata.
How Fintelite Document Forensic Analysis can help
Today’s fraud is evolving fast, and so are we. Fintelite has developed an advanced fraud detection system to analyze documents for potential forgery, duplication, and manipulation. Leverage the power of AI to automatically detect fake documents, ensuring you’re protected throughout your operational processes.
Go beyond the surface to spot signs of flagged fraud. More than just detecting fraud, our system automates data extraction. Within seconds, access all the data you need while staying fully protected.
Book a demo to see if our solution works for you.
