Financial Fraud is a problem that effects millions of people and costs billions of dollars each year. After putting in all this time and effort into improving your personal finances, the last thing you need is to lose it all due to a preventable scam. You can protect yourself by knowing common scams and knowing how to avoid them. In the unfortunate event you fall victim to fraud, it is also important to know what to do next.
Telephone – Calls or texts from people trying to get your personal information or money by making false promises, threats or pretending to be someone they are not. A common one right now is for the scammer to pretend to be the government and try to get your social insurance number, or payment for a fine that does not actually exist.
Banking – An attempt to access your bank account. This can be done through hacking or getting your personal information, likely from a different type of scam (like the telephone or
Ponzi/Pyramid Schemes – A scam where new participants are recruited and money is funnelled to the top (older participants). A common version of these that is not typically viewed as a scam by your average person are multi-level marketing companies (MLM’s).
Government Grant – The scammer pretends to be with the government offering a government grant. They ask for your checking account information and promise to deposit the grant money into your account or require a one-time processing fee.
Ticket – The scammer pretends to sell tickets to popular events. After receiving payment, the scammer never gives you the tickets, and you end up paying for nothing.
Investment – The scammer offers an investment with to-good-to-be-true returns with little financial risk. They keep the money and you’ll never see it again.
Lottery/Sweepstakes – The scammer sells tickets to a lottery or sweepstakes that does not exist.
Charity – A fake organization pretending to be a charity. They receive donations, but the money never goes to the cause.
Census Related – The scammer pretends to be with the government gathering census related information. They do this to steal your personal information, possibly to be combined with other types of scams like banking.
Never send money to a stranger – Whether you are buying things online or not, never send money to a stranger online. Even top online classifieds websites like kijiji advise you to only pay for the things you are buying in person. In private transactions like this, it is not likely you will ever get your money back if you are scammed.
Don’t give out personal information – Do not give personal information out to anyone asking for it. If you get an email from a business saying your account has been compromised, phone them directly. The government will never phone you and ask for financial information over the phone, this is almost 100% a scam. Do NOT give anyone who phones you out of the blue your social insurance number (SIN). There will be institutions who do ask for it (banks for example), but it is very unlikely anyone will email you or phone you out of the blue for it.
Use difficult passwords – If you use harder passwords, it’s more difficult for people to hack your accounts. There is also two-step verification that you can get for a lot of things now. An example of two-step verification: instead of just entering a password, you’ll also have to press a button on an app in your phone. It is inconvenient, but if it is an important account, the extra security is worth it. Also using different passwords for accounts increases your security. It stops a hacker from gaining access to everything by obtaining 1 password.
Never click on hyper-links in emails – it is easy to make a fake email look real. A hyper-link is an easy way to fall victim to a scammer, so just stay away from them.
Only deal with reputable website/online retailers – Do not buy or download things from non-reputable sites. This is an easy way to give your information away, have it stolen, or simply just pay for something you’ll never get.
Only donate to known charities/lotteries – Don’t donate or buy tickets to lotteries and charities that you cannot prove are legit. There are lots of charities and lotteries, so if one looks suspicious, just go find one that looks more legit.
Scammers will often try to make things feel urgent, if anyone is ever pushing you to get something done as soon as possible, take a step back and think about it. By staying calm and being aware of the common scams, you are already extremely less likely to fall victim to one of these scams.
I'm a victim of fraud, what do i do?
If you have already fallen victim to fraud, there’s a couple things you should do next.
Identify the type of fraud – What fraudulent activity are you a victim of? If you are a victim of something minor like ticket, Lottery/sweepstakes or charity fraud, there’s less to do. The person who committed the fraud shouldn’t have any of your private personal information allowing them access to your financial accounts. If you are a victim a banking, telephone or census-related scam where the fraudster could possibly have access to your accounts, there’s a little more to do and time is of the essence.
Protect yourself – If access to your accounts or other financials is compromised, notify your bank, credit card company and even the credit bureaus like TransUnion and Equifax. They will close or watch your accounts for suspicious activity. You should also continue to monitor them yourself as well.
Notify the police – They will fill out a crime report with you. The police should also help guide you through the appropriate steps to handling being a victim of fraud. Another benefit is helping others, if a certain scam spikes in popularity in a certain area, the police usually put out a warning for it.
Report the fraud – Report the fraud to the Canadian anti-fraud centre. This also serves to increase awareness as well as stopping future fraudulent activities. If you lost or fear the fraudster copied any personal government issued items, notify the specific organization that issued the document.