March is Fraud Prevention Month in Canada. Fraud comes in many ways, shapes and forms, and sometimes we underestimate how often Canadians are being scammed each year, leading to millions of dollars lost – $95-million in 2017 alone. As such, the Better Business Bureau (BBB), the Canadian Anti-Fraud Centre and their partners assemble an annual list of the top 10 scams affecting Canadians. The list is based off of the amount of complaints received regarding each type of scam.
Many of last year’s top scams, like online romance schemes and wire fraud, continue to be an issue. In addition, the emergence of the cryptocurrency industry gave way to new types of fraud in 2017.
Fraud comes in many ways, shapes and forms, and you can easily become a victim if you don’t take the proper precautions. Here’s a list of the schemes you should beware of:
1) Online purchase scams (Over $13-million lost)
This was the most reported scam in the BBB Scam Tracker Report last year. Online purchase scams come from fake retail websites offering popular or luxury brands at very low prices in order to acquire your banking information. If the deals seem too good to be true, they probably are.
To determine if an online retailer is reputable, read the company privacy policy and the terms and conditions. Does it list the company’s location information and contact information? Is it a part of organizations like the BBB? Trustworthy sites are usually easier to access by typing the address directly in your browser, rather than being directed to it from search engine results.
2) Wire fraud/ Spearphishing (Over $20-million lost)
If you receive an email request to wire transfer money to someone or even a company that you’re familiar with, this could be a scam.
Think twice before sending any information or money over email. Don’t click on any links in the email, and check if the actual email address look suspicious (contains a bunch of randomized letters and numbers, or the name is slightly misspelt).If you’re still unsure, give the person or the company’s customer service a call to confirm if the email is legitimate.
3) Romance scams (Over $19-million lost)
Those who prey on people looking for love use emotional triggers to get to your personal information. Avoid getting “catphished” by doing a quick Google search to verify the admirer’s identity. Look out for inconsistencies in their stories, and never share personal information over text, instant message or email. If you are to meet them, make sure it is in public place and warn friends or family of your plans. And of course, avoid sending money through wire transfers, Paypal, Interac e-Transfer, etc.
4) Employment scams (Over $5-million lost)
Has a recruiter contacted you claiming they found your resume online? If you didn’t apply, don’t respond. When browsing through job postings, look out for poor grammar, vague or simple requirements, and immediate start dates. Also be suspicious of recruiters who say they want to meet over “instant message” first or any requests for your SIN number or banking information.
5) Cryptocurrency scams (Over $1.7-million lost)
Cryptocurrency is based on the fundamental principles of privacy, decentralization, unlimited use, controlled supply and Blockchain (a public ledger) – all principles that most regular people are unfamiliar with. That being said, this is still a murky environment, and scammers prey on the uneducated. Warning signs to look out for are excessive promotion (i.e. through YouTube channels or social media), referral schemes, any mention of “guaranteed” profits, and “ticking-time-bomb” scare tactics.
6) Income tax scams (Over $5-million lost)
The Canadian Anti-Fraud Centre (CAFC) still receives frequent reports of individuals getting phone calls, emails and text messages from fraudsters impersonating the CRA (Canada Revenue Agency). They claim that consumers have pending refunds or there have been discrepancies with past filed tax returns.
No matter how convincing it may seem, do not provide your SIN number, banking information or personal information over email or text message. The CRA only contacts you via direct mail. If you’re unsure, access you CRA account online or give them a call at 1-800-959-8281.
7) Miracle weight-loss scams (Losses unknown)
These types of scams and fake online pharmacies claim to offer miracle cure medication or supplements which you may never receive, or worse, could be harmful to your health. These offers may come in the form of unsolicited emails, which should be deleted immediately. Always do your research and consult your doctor to find out which products are safe for you.
8) Advance fee loans (Over $1.5-million lost)
Although illegal in both Canada and the U.S., advance fee loan scams were still on the rise in 2017. These scams target customers who have difficulty obtaining cash or credit, and lure them in with promises of “guaranteed” loans. Let it be known that it is illegal for a company to ask for an upfront fee in order to provide you with a loan. So if you are approved and a deposit (or any fee) is requested, walk away.
9) Shady contractors (Over $3-million lost)
Crooked contractors may try to trick you out of your money by asking for payment upfront, insisting on solely verbal agreements, avoiding the process of obtaining a proper permit, or discovering “unforeseen problems” in which they can’t finish the job.
Protect yourself by demanding to see a permit, ensuring the contractors have proper insurance and writing very thorough contracts before any funds are exchanged or work has begun.
10) Fake invoices (Losses unknown)
If you are suspicious of an invoice you received via email, do not open any attachments. Call the organization directly to confirm if the invoice is legitimate and always keep record of your orders so you can verify these types of claims.
As technology modernizes and online shopping becomes a common practice, fraudsters will only become more advanced. Always be cautious in how and where you send your personal details and of course, your hard-earned funds. The best way to protect yourself from consumer fraud is to stay informed and stay alert.
