WHO? HOW? WHERE? WHEN? WHY?

As a consumer, you must recognize both the risk and responsibility involved with each transaction you make. Whether you are dealing with a door-to-door salesperson, telephone solicitor or through the mail, you are taking a risk. It is your responsibility to be alert, to be familiar with common consumer frauds and well informed on tips that may prevent you from becoming a victim of consumer fraud.

If you believe you have fallen victim to a scam, CALL AND REPORT the incident to your local police.

In the world of fraud prevention and investigation, the two most used phrases are “buyers beware” and “you do not get something for nothing”. Commit those phrases to memory and repeat them to yourself whenever you receive any solicitation, particularly when it is by telephone.

  • Do not send any amount of money to someone you have never met until you actually receive what you have been promised.

  • For verification, get the name of the apparent business/agency and contact them via the number listed in the phone book or directory assistance. Do not call the number provided by the caller.

  • If you have call display, write down the caller’s number and provide it to your local police agency when reporting the incident.

  • Contact family members directly for verification of the whereabouts of the family member in question.

  • Never send money through money wire services to persons you do not know personally. The money can be picked up anywhere in the world once it is given a transaction number.

Grandchild in trouble

A criminal contacts an elderly person and pretends to be a grandchild or other family member in trouble with the police. The scammer will tell the victim that he/she has been arrested by a police service outside of their hometown and requires bail money. For verification, the victim is given a phone number to call, which will be answered by someone pretending to be a lawyer or police officer. The scammer will insist that the victim not contact their parents or relatives as they don’t want to get into more trouble. The victim is then asked to use a money wire service to send several thousands of dollars for bail. Canadian Police agencies do not contact individuals for bail money and do not use money wire services.

Identity theft

Identity theft has become an increasingly popular crime in Canada as a result of recent advances in technology. Identity theft involves stealing, misrepresenting or hijacking the identity of another person or business and provides effective means to commit other crimes. Vital information such as name, address, date of birth, social insurance number, and mother’s maiden name need to be acquired in order to complete the impersonation. The identity thief can take over the victim’s financial accounts, open new bank accounts, transfer bank balances, apply for loans, credit cards and other services, purchase vehicles, take luxury vacations, and so on. The true owner may be liable for activities related to identity theft.

  • Sign all credit cards when you receive them.

  • Never loan your credit cards to anyone.

  • Cancel credit cards you do not use and keep a list of the ones you use regularly.

  • Immediately report lost or stolen credit cards and any discrepancies in your monthly statements to the issuing credit card company.

  • Never leave receipts at bank machines, bank counters, in trash cans, or at unattended gasoline pumps; ensure you destroy paperwork you no longer need.

  • Never provide personal information such as Social Insurance Number (SIN), date of birth, credit card numbers, or Personal identification number (PIN) over the telephone unless you initiate the call.

  • Promptly remove mail from your mailbox after delivery and do not leave pieces of mail lying around your residence or work site.

  • Shred or otherwise destroy pre-approved credit card applications, credit card receipts, bills and related information when no longer needed.

  • Avoid keeping a written record of your bank, PIN number(s), social insurance number and computer passwords, and never keep this information in your wallet or hand bag.

  • Avoid mail or telephone solicitations, disguised as promotions or surveys, offering instant prizes or awards designed for the purpose of obtaining your personal details, including credit card numbers.

Pigeon drop/bank inspector fraud

This scheme accounts for more than half of the confidence games reported to the police. The swindlers claim to have found a large sum of money and offer to share it with you. You are asked to withdraw “good faith” money from your bank. The swindlers take the “good faith” money and give you a phoney address where you are to collect your share of the found money. You never see them again.

The phony bank inspector contacts you and asks for your help in catching a dishonest bank employee. You are asked to withdraw a specified amount of cash from your account so that the inspector may check the serial numbers. After turning over your money, you never hear from the inspector again.

  • DO NOT give out financial or personal information over the telephone or internet.

  • Hang up the telephone. Immediately dial *69 on your touch-tone telephone, or 1169 on your rotary telephone. This will give you the information on who just called you. Be sure to write it down.

  • Immediately call your bank manager or someone known to you at your bank and notify him/her of what has happened.

  • Contact your local police and report this incident.

  • Avoid rushing into something involving your money or property.

  • Be wary of “something-for-nothing” or “get-rich-quick” schemes.

  • Never turn over large sums of cash to anyone, especially a stranger, no matter how promising the deal looks.

Contracts

In an attempt to have you to sign a contract, a salesperson may tell you: “It is just a formality; “There is nothing to be concerned about”; or “It is for your protection”. However, there may be clauses in the contract that go beyond what you have been verbally led to believe. A contract is an oral or written agreement between two or more parties which is enforceable by law. Once you have signed, a contract is binding and you are obligated to meet the terms of the agreement. Even if the contract is questionable, for you to break the contract may require expensive legal services. Never sign a contract until you and your lawyer, banker or other expert have thoroughly read it.

NOTE: Contact your lawyer or the Ministry of Consumer and Business Affairs for laws and information pertaining to cancellation of contracts, clarifications of contracts or the content in contracts.

Home renovation fraud

The person at the door seems genuine and will tell you:

  • they just happened to be in the area;

  • they have a crew of workers and

  • material and can give you a special deal;

  • they offer “special senior discounts”.

Con artists appear friendly and knowledgeable and will offer any service whether you need it or not. They will charge amounts exceeding three to four times fair market prices and may not complete the work. Be assured, their true intention is to convince you to sign a contract and to line their own pockets, while they politely empty yours.

  • Demand a few days to think about the deal. If the deal is good today, it will be good tomorrow.

  • Make sure the senior’s discount is legitimate. Find out through other contractors the legitimate price of the work being offered – get at least two other estimates.

  • Ask for, and check, references.

  • Do not hesitate to check the credentials of a salesperson or public official.

  • Check out the company with the Ministry of Consumer and Business Services or the Better Business Bureau and ask for assistance.

  • No matter what this person tells you at the door, do not be in a rush. Take your time and be an educated consumer.

Door-to-door sales

Many door-to-door sales are not legitimate. Provincial laws protect you against quick sales at your door.

  • Ask to see the salesperson’s identification and licence or registration. Take note of their name as well as the name and address of the company.

  • Before purchasing a product or service, call local stores who sell the same merchandise and compare prices.

  • Don’t be pressured into buying anything. Watch for signs such as: an offer of a“free gift” if you buy a product and an offer that is only good for one day.

  • Ask the salesperson to leave as soon as you feel threatened or intimidated.

  • Don’t leave the person unattended.

  • Report the incident to the police if you are suspicious.

  • Your province/territory may give you a specified number of days during which you can cancel a contract you make with a door-to-door salesperson. Please contact your local consumer protection agency for further information.

Public utility imposter scam

You receive a knock at the door and are confronted by two people. They claim to be from one of the Public Utility Company’s inspection services. Once they are in the house, one will have you accompany him to the in-home service location (gas-meter, water-meter or electrical panel usually located in the basement). The other will ask to use the washroom, the telephone or merely wait upstairs. These people may not be utility inspectors. They may be thieves searching your house for valuables, medication and information about you. Quite often when they leave the home, the theft goes undetected for a long period of time. Could you tell if part of your medication or some of the money from your purse/wallet was missing?

  • Always be especially cautious if there is more than one person at your door.

  • Demand identification at the door. Carefully check the identification and, if in doubt, DO NOT LET THEM IN.

  • Call the public service department of the utility company and confirm the identity of the apparent inspectors.

  • Never leave anyone alone in your home. Tell them they can use the telephone or washroom somewhere else.

  • Do not hesitate to check the credentials of a public official.

The lottery scam / charity scams

The caller appears to be soliciting for what is clearly a worthy cause, although you do not recall ever hearing the exact name of the charity before. Many scams are successful because the name of the charity being used in the scam is similar to an easily recognized charity or event.

The caller wants you to be a part of a special group that is buying a large number of lottery tickets. This will better your chances of winning. These are usually foreign lotteries. They sometimes claim to be able to decrease the odds from millions to one down to as low as six to one, making you almost a winner.

There are so many charities that it is almost impossible to know them all. Do not try. True charitable causes are worthwhile and should be supported. They are frequently listed in the telephone book. Arrange to have your contribution delivered to them directly or ask them to mail you a donation envelope. Using this approach ensures that your donation goes to the charity you wish to support. DO NOT SEND MONEY TO AN UNKNOWN CHARITY.

No matter what the caller says, the odds per ticket remain the same, usually millions to one. Your community benefits only from lotteries based in your province. DO NOT BUY LOTTERY TICKETS FROM A TELEPHONE SOLICITATION.

Free vacation scams/the prize scam/chain-referral scams

The caller offers you incredible savings and sometimes even free travel or accommodation to popular destinations. Certificates are issued in your name representing a reservation.

The caller, or email, tells you that you have won a valuable prize or prizes but first you must submit a payment to cover such thing as taxes, transportation, customer’s insurance, legal fees, etc.

This scam offers you a commission for buying one item and selling additional ones to friends. Once you sell a certain quantity of product you will receive “bonus” money. You do not get something for nothing. If you try to take advantage of this golden opportunity, you will undoubtedly end up paying the original cost of the vacation. Do not buy a vacation through a telephone sales pitch. When traveling, deal with a reputable agent. When you’re a winner, you do not have to pay for your prize. DO NOT SEND THEM ANY MONEY IN ADVANCE. The products are usually over-priced and difficult to sell. The quantity of product you must sell in order to receive your “bonus” is usually never attainable.

Business opportunities/area code scam

Most often, you are contacted by telephone or through a newspaper advertisement. The ads promise business opportunities and work-at-home schemes, which promise high profits after you send a substantial investment or registration fee.

Individuals receive a message telling them to call a phone number with an 809, 284, 649, or 876 area code in order to collect a prize, find out information about a sick relative, etc. The caller assumes the number is a valid Canadian area code; however, the caller is actually connected to a phone number outside of the country, and charged international call rates. Unfortunately, consumers are unaware that they have been charged the exorbitant rates until they receive their bill. A legitimate business would not require an investment or registration fee. Contact the Ministry of Consumer and Business Affairs or the Better Business Bureau.

  • Return calls to familiar numbers only that contain recognizable area codes. You may call your phone service provider to check the area code location.

  • Carefully read your telephone bill. Make sure that you only receive charges only from your service provider of choice and have authorized additional fees invoiced.

Medical fraud

Fake laboratory tests, miracle cures, and mail order clinics, etc . . . are other ways to defraud you. Unfortunately, there is no such thing as a miracle cure. Legitimate doctors and hospitals do not advertise through the mail.

If you suffer from a particular ailment, seek the advice and services of qualified medical practitioners. You should report phony medical treatment being sold through the mail to your physician, local medical authorities or police.

Faked e-commerce websites phishing

Nowadays, people have the luxury to do their shopping, banking and employment search with the help of the internet, in the comfort of their own homes. The internet also allows people to search for businesses, auction items, communicate and play games among many other things.

However, along with this new technology comes new types of crime; here’s how you can identify them.

These E-commerce websites will try to sell you something and the offer will seem too good to be true. Set up to capture your personal information, they will operate for a few weeks and then disappear.

Phishing is a general term for e-mails, text messages and websites created by criminals. They are designed to look like they come from well-known and trusted businesses, financial institutions and government agencies in an attempt to collect personal, financial and sensitive information. It’s also known as “brand spoofing” and “pharming”.

Auction fraud

An online auction provides items for sale that may be bought by bidding on the items. Online auction frauds include misrepresentation of an item, non-delivery of goods and services and non-payment for goods delivered.

Advanced fee letter fraud/ malicious software

The Nigerian letter scam is well known to many people around the world and is now being perpetrated via email. It usually involves a letter from a government official, or an officer of a Nigerian state business, who claims to have stolen millions of dollars and needs to get the money out of the country. The person claims they cannot use their own bank account to do this and asks to use yours. In exchange for this service, they offer to give you 10-35 percent of the money. Once the fraudster has your account number, they then withdraw money from your account.

This scam comes in many forms and offers you tremendous return on your investment. You are asked to send money overseas to a certain bank account. You are then asked to invest more and more to avoid losing money on your investment. In all cases, the money is lost and unrecoverable. This scam is not restricted to letters or email from Nigeria, but all variations involve the same telltale signs of requiring money up front or access to your bank account.

Malicious software comes in different forms such as viruses, worms, Trojan horse programs, spyware and adware and can be transmitted by opening e-mail, by accessing a website, by using infected media or by downloading infected programs such as games.

  • Take the necessary time to research prior to purchasing merchandise.

  • Ignore a good offer when you cannot validate it.

  • Immediately delete electronic messages.

  • Always watch for unusual patterns and any discrepancies in the website’s address or its web page.

  • Remember that no taxes or fees are to be paid in order to receive a legitimate prize in Canada.

  • When bidding online, read the online learning guide and security tips that may be available this may minimize the risk of becoming a fraud victim.

  • Protect your computer by keeping your operating system and software packages up to  date. Also use software such as anti-virus, firewalls, anti-spyware and anti-adware.