BC Association of Community Response Networks

Top 10 Frauds: Grandparent, Romance, Investment Scams, and More!


Top 10 frauds blog image, stop sign that says fraud alert with open lock image

Rounding out our month of fraud awareness is a series of top fraud scams reported to the RCMP and the Canadian Anti-Fraud Centre (CAFC). Investments, romance and grandparent scams led the way to extorting Canadians out of $530 million in 2022.

We know that amount is vastly under reported as the CAFC estimates only 5-10 percent of people report fraud. Here are the top 10 frauds based on dollar loss in 2022:

Fraud Type Dollar Loss
Investments $308.6 million
Romance $59.0 million
Spear Phishing $58.1 million
Service $20.6 million
Extortion $19.0 million
Emergency $9.4 million
Merchandise $8.7 million
Job $7.1 million
Bank Investigator $6.7 million
Foreign Money Offer $4.5 million

 

Let’s look at some of the top frauds that target older and vulnerable adults.

Investment Fraud

Investment scams produced the highest losses reported in 2022 to the tune of $308.6 million. Often these investment opportunities offer higher than normal returns, appealing to investors’ needs to make a high return. Sadly, many lose their life savings.

These days most investment scams involve cryptocurrency investments and require the victim to download an app which is controlled by fraudsters. The RCMP advises that most victims are unable to withdraw their money after transferring cryptocurrency into their trading accounts. The other noteworthy thing is that cryptocurrency can’t be traced, so victims have no recourse once their money is gone.

  • Be wary of people you’ve just met online who attempt to have you invest, speculate or loan them money.
  • Before investing, ask for information on the investment.
  • Consult with your financial advisor, banker or trusted family member with financial knowledge to verify the project is real.

Romance Scams

Romance scams involve fraudsters finding their victims on dating sites and through social media. They may reach out and ask where you are or where you’ve been. Once you respond, they strike up a conversation to learn more about their potential victim and earn their trust.

Victims can easily be taken unaware. Fraudsters comb social media looking for profiles they can copy, including photos, stories about pets, friends and hobbies, even job descriptions. A quick search reassures victims about their new connection. Then comes the ask for money for a family emergency, inability to access existing funds, airfare to return from another country – you name it, the sad story is likely a phony.

  • Be wary of profiles that seem too perfect.
  • Don’t trust someone you haven’t met who declares their love for you.
  • Be suspicious if the person wants to quickly move to private communication, such as emails or texts, cancels meet-ups, or is not available to meet you in person.

Service Fraud

There are a variety of service scams such as home repairs, tech support, immigration and financial services. It’s important to use recognized companies and not jump at the best deal offered, especially from door-to-door sales people or pop-up windows on your computer.

  • Air duct cleaning is a common scam, wherein the “technician” is unqualified and can damage your furnace or ventilation system. Warranties are invalid (because they don’t exist) and homeowners have to pay for repairs.
  • Cell phone service providers who phone to offer you a better deal are likely scammers. Having obtained your social insurance number or driver’s licence number, these criminals may use your identity to apply for a passport, get a cell phone, or obtain a bank loan that they won’t pay, leaving your records as owing the money. They also may sell your credentials to another fraudster.
  • Help with government documents for a fee, such as passports, pensions, birth certificates and driver’s licences are also ways to get your money and steal your identity.
  • Low interest rate credit cards are offered by fraudsters to obtain information such as your mother’s maiden name, your social insurance number, your birthdate and your current credit card information.

Back to the old saying: if it’s too good to be true, it likely is. Beware good deals! Either check them out independently or use accredited, recognizable companies.

Grandparent Scams

We don’t have a dollar value on grandparent scams for 2022 because they generally lead to  different schemes such as investment fraud, identity theft, emergency scams, or extortion.

Fraudsters call seniors and pretend to be a family member in distress, the police, a bank investigator who needs help or a justice official claiming that a grandchild is in trouble. They ask for money immediately to solve the issue, but warn them not to tell anyone as there is a gag order in place. These are all signs that a fraudster is on the phone or emailing.

A new scheme has just been uncovered where fraudsters used artificial intelligence software to mimic the voices of victims’ grandchildren. At least eight seniors in Newfoundland lost $200,000 to this elaborate grandparent scam.

  • Be suspicious of anyone who needs money immediately. Hang up the phone and call the police or the supposed family member directly.
  • Courts don’t call to ask for fines or bail for family members. You would have to be present in court.
  • Never send cash, e-transfers, cryptocurrency or any other funds to people you don’t know or unknown bank accounts.

Fraud Prevention Starts with Awareness

This month we’ve talked about passwords, spoofing, scams and the many ways criminals try to get their hands on your money. If you remember nothing else, remember these points:

  • If it’s a stranger asking for your money, hang up.
  • If it’s urgent or you feel threatened, hang up and ask for help from family or the police.
  • Pop-up boxes on your computer that offer prizes or free goods and cruises are put there to lure you into clicking and downloading malware. See our article on this.
  • Don’t trust the first result on Google. They may well be ads placed by fraudsters. Check the web address to make sure it’s the actual company that you are seeking.
  • Don’t click links in random emails.

Seniors and others are often too embarrassed to tell their family members or caregivers for fear of being considered incapable of taking care of their own affairs. You’d be amazed at how many potential fraud schemes are out there every day. Know that you are not alone and these criminals are very good at what they do.

If you suspect you, your client or family member has been a victim of fraud, report it to your local police and the Canadian Anti-Fraud Centre’s online reporting system or phone 1-888-495-8501.

 

Written with many thanks to the RCMP and Canadian Anti-Fraud Centre. Access recent bulletins and other financial abuse information on our Financial Abuse page.