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Canada authorities report record losses to investment fraud 


Nowadays, it is more and more important to be aware of online scams. They seem to be everywhere – between high profile social media sites like Facebook and YouTube, to popping up in otherwise innocuous Google searches, you need to know what to look out for. The Canadian Anti-Fraud Centre (CAFC) is an organization which is created to help victims of fraud get justice. However, the best way to prevent being scammed is to be aware of the schemes that fraudsters run. In 2022, the level of money lost to these has skyrocketed as compared to the previous year. In the article below, we will outline the five most common schemes to look out for. Before we do that, however, here is the impact of scams in the past year:

Just how much money was lost to scams in 2022

The CAFC reports that $420,8 million has been lost to fraud as of the end of October 2022. Even though the Centre does not have information for the entire year as of yet, the trend is worrisome. This is because the entirety of 2021 saw a loss of $383,6 million. This means that even though data from Black Friday and the holidays is not available – the two times of the year where scammers truly make a killing, the number from 2021 has been surpassed by over 10%. 

What has caused this uptick in fraud? A possible explanation is that the world is fighting with high rates of inflation, which means that the cost of living is increasing all around the globe. Scammers are able to thrive in times of financial uncertainty, because they sell their clients the dream of easy profits. Under stress, it is reasonable to assume that more people could end up victimized by this. 

What are some common online scams to look out for

Fraud has always been and will always be around. What’s more, the internet has introduced new and more sophisticated ways for scammers to con their victims. Here are the most common ways conmen will try to steal your money using it:

Investment and trading scams

These scams are really diverse and can take many forms. Most recently, they have been popping up as crypto companies. These are your fake crypto exchanges, shady digital asset companies which offer insane return rates and so on. They also often take the form of more traditional financial institutions. Fake banks, investment funds and Forex brokers are examples of that. 

The best way to tell one of these from a legitimate company is to check with the Canadian regulatory body – the IIROC and see if the firm is present within its register. Any company offering investment services is required to obtain the approval of the IIROC. This ensures that it is legitimate. Furthermore, the regulatory regime that is in force in the country is a bit ahead of the curve. That way even crypto companies are required to be licensed, which is not the case in most places. Accept no substitutes for legitimate firms – stick to licensed Canadian forex brokers, investment funds, crypto exchanges and so on. 

Another key scam sign to watch out for is the promises of unrealistic return rates. Know that no-one will be able to guarantee an ROI of over 10-20% yearly as these fraudsters claim to offer. Some of the more unhinged ones even offer these amounts within a day. It is all a ruse to get your money out of your hands!

Romance scams 

This is one of the fastest rising trends among scammers. The romance scheme, or the graphically titled pig-butchering scam is very dangerous. If you meet someone on a dating site, who presents themselves as some sort of investment guru, a lucrative Forex trader and so on unprompted, beware. These people could direct you to a fraudulent investment or trading platform, as the ones described above. What makes them so dangerous is the fact that these criminals build a personal connection with their victims. They will learn a lot about you and be able to manipulate you into depositing thousands with them. Your trust will be exploited and your bank account will be drained!

Fake online stores

Online shopping is very fast and convenient. It allows you a wide selection of products from around the world. However, there is also a certain degree of danger to it. Nowadays it is very easy for scammers to set up online storefronts. They can advertise popular products on them, with hugely discounted prices. The catch is, of course, that the products do not exist! The so-called store is just a way for you to throw your money down the pockets of the fraudsters. You will most certainly not be getting what you are paying for. A very popular time of the year for these scams to pop up is around the winter holidays, when most people do their gift shopping. 

Phishing and malware attacks 

This is a bit more of a contrived scam that is executed by more seasoned criminals. It involves you receiving an email, or text that includes a file or link. There can be several different ways this message can be structured. Most dangerous are the ones which are supposed to be from a bank or other financial institution. They seem urgent and official. In them, the supposed financial institution requires you to click the link or download the file. 

If you follow the link, you will get to a website that might look legitimate – but if you enter any personal information within it, it will be stolen by scammers. That way, you can stand to have your bank account drained by them. And if there is a file to download, it can contain a dangerous virus which can lead to scammers obtaining valuable personal information from your computer. In general, know that legitimate institutions like banks will never reach out to their clients unprompted, ask them to reveal their passwords, or send them any files!

Advance fee scams

Last but not least are the advance fee scams. The scheme with them is rather simple to tell apart. You will be contacted by someone wishing to give you a large amount of money. The scammers are very creative when it comes to coming up with scenarios – they will pretend to be Nigerian princes, the UN, or some sort of prize foundation. They will tell you the money is as good as yours and that there is only one formality – you need to pay a fee of several hundred dollars to move the deposit along. Somehow, it is never possible to take that fee out of the millions that they promise. This is because there is no such sum, and if there were, why would they hand it over to some random person?

Another common theme with them is the fact they usually require you to pay the advance fee via obscure methods like buying gift cards and sending them to the fraudsters. Why would the UN require you to pay in Amazon gift cards? Although obvious, this is still a serious scam to be on the lookout for!

Other articles from mtltimes.ca – totimes.ca – otttimes.ca

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