Beware of Financial Scams

Beware of Financial Scams – An Accountant’s Viewpoint

 

As personal tax returns are assessed, criminals posing as Canada Revenue Agency (CRA) employees are contacting potential victims through a variety of means to commit fraud. These criminals try to obtain confidential information about individuals such as a social insurance number (SIN) or credit card number and PIN. It is important to be vigilant and know how to recognize fraud. Fraudsters attempt to hook a victim in many ways. These include, but are not limited to:

 

  • Telemarketing Defrauds – any fraudulent or deceptive act where the potential victim is contacted via telephone
  • Identify Theft – any fraudulent or deceptive act used to obtain personal information for a criminal act
  • Mail Scams – any fraudulent or deceptive act carried out via mail either through postal or private mail service
  • Email & Text Messaging Scams – any deceptive act committed through email or text message
  • Online Scams – any misleading, deceptive or fraudulent act that potential victims encounter while using the internet

 

The CRA does not request personal information of any kind (i.e.: SIN or banking information) via email or text message, nor do they leave personal information in a voicemail. A scammer will insist this information is required to access a refund or other benefit payment (such as Old Age Security). They may use inappropriate or intimidating language designed to scare victims into complying with their request. This is a red flag, as CRA does not conduct business in this manner.

 

Unfortunately, scammers of all types prey on the vulnerable. They attempt to obtain direct payments from their victims, access the personal information necessary to steal their identity, access credit cards, or apply for debt in the victim’s name. Taking the following precautions will help reduce identity theft:

 

  • Shred unneeded documents or store them in a safe place
  • Ask a trusted neighbor or friend to pick up any mail while away, or have it held by Canada Post
  • Never leave documents that include name and SIN unsecured
  • Do not write down or carry passwords with you
  • Do not rely on caller ID to determine if a caller is legitimate as caller ID can be altered
  • Be aware of phishing scams where criminals collect personal information when a link is clicked in an email
  • Update new addresses with all government departments so mail does not go astray
  • Protect your SIN and never use it as a piece of ID. Unless an organization is legally required to collect it, use another form of ID. Ask organizations if they are legally required to collect your SIN before providing it
  • Never provide personal information through the internet or via email, even if the email claims to be from CRA as the CRA never asks for personal information via email

 

Unfortunately, CRA fraud is not the only fraudulent activity to consider — any offer that sounds too good to be true is very likely fraud. Offers for free money are also likely to be a fraud and there are many variations of this swindle. The most common is a message asking for a small amount of money to secure the prize or to pay the taxes owing on the prize, at which time they will release the winnings. Of course, once the money is sent victims never hear from the scammer again.

 

Another variation occurs when an item is sold online and the customer sends more than the purchase price and asks to be refunded the difference through a wire transfer. They may claim they accidently overpaid, or ask the victim to wire the shipping fees to their shipper. The scammer may have actually paid for your item with a stolen credit card. While the funds may have been deposited to the account, once the fraud is discovered, the credit card company will take the money back out of the account. The victim is then missing merchandise, the sale price, and possibly any additional wired funds.

 

Being aware of the common types of fraud, and carefully considering an odd or suspicious situation before taking any action at all is the best way to avoid becoming a victim of fraud. Be cautious and do not allow high-pressure tactics. Even the most vigilant among us can fall victim to fraud. If there are concerns you may have been a victim, consider the following:

 

  • Report fraudulent telemarketing to the Canadian Anti-Fraud Centre by calling 1-888-495-8501 or online at http://www.antifraudcentre-centreantifraude.ca/.
  • For a stolen SIN, contact Service Canada at 1-800-206-7218.
  • Possible victims of fraud should contact the local police department.

 

 

Contributed by: Leanne McDougall, CPA, CA

Senior Manager, BDO Canada LLP

BDO Penticton  250-492-6020

 

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