Government Impersonation: The EIN Scam Undermining Trust

Picture a world where a free government service, designed to help everyday Americans start businesses or settle estates, gets turned into a cash cow for shady operators. That’s exactly what’s happening with Employer Identification Numbers, or EINs. The Internal Revenue Service hands these out at no cost, yet slick websites are charging folks up to $300 a pop, all while masquerading as official government portals. It’s a blatant rip-off, and the Federal Trade Commission is finally sounding the alarm.

This isn’t just a minor glitch in the system; it’s a full-on assault on hardworking people trying to navigate life’s challenges. Opening a small business, hiring a nanny, or managing a loved one’s estate shouldn’t come with a hidden tax courtesy of scam artists. The FTC’s recent letters to these EIN peddlers signal a long-overdue wake-up call, but the question looms: why has it taken this long to tackle a scam so shameless it’s practically begging for a crackdown?

These operators aren’t subtle about it. Their websites flash IRS-like seals, logos, and fonts, practically screaming legitimacy to anyone who doesn’t know better. Some even sneak the IRS acronym into their domain names or tout themselves as ‘EIN Assistants,’ a term lifted straight from the IRS’s own free tool. Consumers, many of them first-time entrepreneurs or grieving families, stumble into these traps, shelling out hundreds for something they could’ve gotten in minutes, no charge, straight from Uncle Sam.

The FTC’s warning letters, sent out just days ago on April 1, 2025, lay it bare: these tactics might violate the FTC Act and the Impersonation Rule. Violators could face fines topping $53,000 per incident, plus refunds for every duped customer. That’s real money, and it’s about time. Look back at the past two years—cases like FTC v. Superior Servicing LLC and FTC v. DOTAuthority.com, Inc. show the agency’s been battling similar cons. Yet here we are, still watching scammers fleece the public under the guise of government authority.

This isn’t just about dollars and cents; it’s about trust, or what’s left of it. The Thales 2025 Digital Trust Index paints a grim picture—consumer confidence in online services is tanking, with only banks holding a shred of credibility among the under-30 crowd. Impersonation scams, like the 370,000 phishing sites popping up monthly last year, are a big reason why. When people can’t tell a legit IRS page from a knockoff, they stop trusting everything. And who can blame them? Eighty-two percent of consumers ditched brands over privacy fears in 2024 alone.

The EIN scam feeds right into this mess. Every time a small business owner or a widow gets burned, the ripple effect hits us all—less faith in government, less willingness to engage online, and more hesitation to take risks like starting a company. Advocates for tighter regulations argue it’s a systemic failure, but that’s a cop-out. The real fix isn’t more bureaucracy; it’s enforcing the rules we’ve got and hitting these fraudsters where it hurts.

Give credit where it’s due: the FTC’s been swinging hard lately. In 2024, they clawed back $337.3 million for consumers, up from $324 million the year before. Cases like Benefytt Technologies, where $99.3 million went back to over 463,000 victims of a health insurance scam, prove they can deliver. Chris Mufarrige, head of the Bureau of Consumer Protection, isn’t mincing words either: impersonating the government is flat-out illegal, and businesses better clean up their act or face the music.

Still, the numbers don’t lie—consumer fraud losses jumped 25% in 2024, and government imposter scams alone drained $577 million, per the Social Security Administration. The FTC’s victories are real, but they’re playing whack-a-mole while the moles keep multiplying. Historical wins, from busting telemarketing fraud in the ‘90s to nailing robocallers in the 2010s, show the agency’s got the chops. What’s missing is the scale to match today’s digital free-for-all.

Here’s the bottom line: Americans deserve a system that works for them, not one that lets con artists siphon off their hard-earned cash under fake IRS banners. The FTC’s latest move is a step forward, but it’s not enough to just send stern letters. These operators need to feel the full weight of the law—fines, shutdowns, refunds, the works. Anything less, and we’re just inviting more of the same.

This fight matters because it’s about more than EINs; it’s about keeping faith in a free market where people can chase their dreams without getting fleeced. The FTC has the tools, the precedent, and the will. Now it’s time to finish the job. Let’s protect the little guy, not the liars hiding behind government logos. That’s the American way.