Article By: Elizabeth Rogers
Find out the latest tactics criminals are using — and who they’re targeting.
The tactics may be different but the goal of scams is the same: Make money, no matter who gets hurt. Every year, Canadians lose millions of dollars to con artists, hackers and scammers, and they always seem to have a new set of tricks to catch the unwary.
However, our cash isn’t the only thing we can lose. Criminals are also after our personal and financial information, which they can use to commit identity fraud or sell to other criminals. They can ruin people’s reputation and credit scores, and leave them feeling vulnerable, gullible and ashamed.
It takes a lot of effort to stay a step ahead of the criminals, but awareness is a tool we should all have in our arsenal. Here’s a “heads-up” on the state of scam in Canada in the past year.
Top scams affecting Canadians
According to the latest report from the Canadian Anti-Fraud Centre (CAFC), here are the top scams reported by Canadians in the past year:
Service: Want a lower interest rate on a credit card? An extended warranty for your car, a new service plan, or a deal on long distance calling? Service-related schemes are at the top of the list of scams that Canadians reported in 2009, so it pays to be sceptical of the deals you’re offered.
Another no-no — paying big fees or deposits upfront for services like home renovations. (See Big cash renovation deposits are big mistakes for details.)
Merchandise: These scams can take many forms, but they all involve paying for items and services that aren’t what you bargained for (if you receive them at all). Scams often involve the latest tech gizmos (like Apple’s new iPad) or sought-after items. Watch out for fake e-commerce sites and online auction scams, and be suspicious if you’re offered payment options like money order, cash or wire transfer. Phoney escrow sites are even popping up to fool buyers of big ticket items.
Another common tactic — “free trials” that end up costing customers big bucks.
Sale of merchandise (by complainant): Selling items online? Beware: online classifieds and services like eBay are rife with con artists, and sellers are caught as well as buyers. The RCMP warns the best way to avoid these scams is to understand (and follow!) the terms of service, polices, procedures and precautions suggested by the service itself — like meeting the people you’re doing business with in person if possible.
Prize: You’ve won an exclusive prize like a car, cash or a free trip in a contest you don’t remember entering — but you have to pay a fee, fork over “taxes” or make a purchase. In Canada, consumers don’t have to pay up when they win a prize, so the only real winner here is the crooks.
Personal information: Sometimes your personal information is worth more than your cash. Scammers may ask you to fill out a survey or online quiz, or collect your details through a fraudulent prize entry form at the mall or at a convention. You’ll soon find your information shared and misused, and you’ll be on the receiving end of spam and phone calls. The RCMP warns that the crooks can even analyze your handwriting.
Job: Given the state of the economy, it’s not surprising that online employment scams and work-at-home scams continue to be popular. You might be asked to pay a fee to apply for a job, or purchase a “kit” or list of employers. Often the real purpose of these schemes is to get your personal information — like your social insurance number — which you shouldn’t have to provide until you are actually hired.
Phishing : The hallmark of the phishing scam is that it looks like a real email from a company you deal with — like your bank or an online payment service. However, it could contain a virus or coax you into entering your personal information at a lookalike website. (See Email: what’s safe and what isn’t for details.)
The latest in phishing scams involving “SMiSing” (phishing attacks via text messaging) and “vishing” (where readers are directed to call a fraudulent phone number instead of clicking on a link).
Vacation : The scammers know we’re looking for deals — that’s why travel-related scams continue to be a big problem. Fraudulent companies may disappear with your money, or give you sub-standard services and accommodations. (Read our tips for avoiding vacation scams)
Collection agency : You receive a call or notification that a payment is past due. It could be a fake debt collector, or an agency that refuses to play by the rules. Proceed with caution: check with your provincial government about rules and policies governing collection agencies in your province, and report any suspicious behaviour. Avoid giving out any information until you’re sure you know with whom you are dealing, and check your credit reports to see if you’ve been the victim of identity fraud.
Directory : Scammers attack businesses too, and directory cons are a popular tactic. Your business may offered a chance to advertise or be listed in a local directory (which doesn’t actually exist). You might also receive a legitimate-looking invoice for a listing you never accepted, or get a phone call asking you pay up or to confirm your payment information. (The Competition Bureau has more information about business-related scams.)
Many of these scams originate in Canada — from places like Toronto, Montreal and Ottawa — as well as from abroad. Other popular cons include phoney inheritances, fake emergencies and romance (not to mention the infamous Nigerian letter scam). Charity scams also continue to prey on people’s generous nature, especially in the wake of disasters like the earthquakes in Haiti and Chile. (See Good cause or costly scam? and the Holy con artist for tips on avoiding these scams.)
Top solicitation methods
How are the scams being perpetrated? You might be surprised that con artists don’t always hide behind anonymous emails or phone calls. In fact, the most costly solicitation method was “in person” — the CAFC received only 344 complaints, but victims lost over $5.8 million.
Criminals are certainly taking advantage of the growth of online media — and it’s a cheap and quick way to reach a broad audience. Scams that were based in text messaging, email and the Internet netted the most money and the most victims — a whopping $14.4 million in losses and about 10,600 complaints.
The most popular method? It’s still the phone and fax machine that earned the most complaints. The good news is that people aren’t so quick to fall for these scams. The percentage of victims was smaller than for other methods, and their losses were less at $3.1 million.
While traditional methods like print, mail, radio and television aren’t as popular, they haven’t disappeared. This category of media had the fewest complaints and the smallest cash losses — but it’s still important to not believe everything you hear or read.
Top targets?
We’re well aware that scammers often target seniors, but experts warn that anyone can be a victim regardless of age, income or location.
Who are some of the top targets? Children and teens appear on the latest fraud warning lists. Experts warn that younger generations aren’t as web-savvy we think. They can be tricked into giving out information online, or they can be involved in scams themselves. (See Keep kids safe on social networks and Stop scammers from targeting your teens for more information.)
Even web-wary baby boomers aren’t immune. According to the CAFC report, people between the ages of 50-59 had the highest rate of complaints and reported higher financial losses than any other group — a whopping $6.2 million. Next in line are people ages 40-49 (approximately $4.2 million in losses) and people ages 60-69 ($3.8 million).
Should the numbers worry you? Statistics only show what people report, so actual numbers could be higher because people may be too embarrassed to admit they were affected. It’s also possible that the large number of Zoomers affected is simply due to demographics — after all, they’re the largest age group in Canada and they control a significant chunk of the country’s wealth.
What can you do to prevent becoming a victim? There’s no sure-fire way to avoid all the scams out there, but being aware of the latest tactics and warning signs can go a long way to preventing these crimes.
ON THE WEB
Read the latest reports from the CAFC .
For more information on fraud prevention, visit the Fight Fraud section on 50Plus.com and check out these sources:
Canadian Anti-Fraud Centre (PhoneBusters)
Competition Bureau: Fraud Prevention
RCMP: Personal Information and Scams Protection – A Canadian Practical Guide
RCMP: Scams and Fraud
READ MORE FROM 50plus.com
Conduct a financial fire drill
8 steps to get financially organized
The State of Scam 2010
This entry was posted on Friday, March 5th, 2010 at 9:22 pm and is filed under ZoomerLife Money. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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