March is Fraud Prevention Month and Lethbridge Police are reminding residents to be scam savvy to prevent becoming a victim.
This year’s theme, “20 Years of Fighting Fraud: From Then to Now,” sheds light on how scams have evolved with the use of technology. The campaign aims to help Canadians recognize warning signs, reject suspicious claims and report fraud to police.
According to the Canadian Anti-Fraud Centre, in 2023 Canadians lost $567 million – an increase of $37 million from 2022 and $187 million since 2021. But despite the rise in financial losses, fraud reports remain low with only five-10 per cent reported.
Last year nationwide, the top three most reported types of fraud were identity fraud, service fraud and phishing, schemes orchestrated to get people to pay or give away sensitive information such as their social insurance number, passwords or banking details.
Locally, members of the Economic Crimes Unit are seeing an increase in investment fraud – specifically involving transactions with cryptocurrency, such as Bitcoin and Eth.
If you’re looking to invest your hard-earned cash, it’s important to exercise due diligence and watch out for red flags:
- If it sounds too good to be true, it is. All investments have some level of risk. Fraudsters often try to hook people by guaranteeing extremely high returns in a short period of time with little to no risk.
- Pressure to make a quick decision. Individuals who promote fraudulent schemes don’t want to give you time to figure out their game. They may also pressure you to invest a little at first and once you do, they will come back seeking a larger amount.
- Fraudsters may offer to help you with your investment account or ask for remote access to your computer or mobile device. Giving out account information or allowing someone to access your device is extremely risky.
- Exclusive offers. Be wary of investments that are promoted as exclusive offers only you and select people have access to. Fraudsters like to name drop or say they have access to famous or rich people when promoting an investment.
- “Insider” information. If an investment advisor or individual says they are giving you confidential investment advice, they may be deceiving your or their employer. Both put you at risk. It’s illegal to knowingly trade on inside information.
- Offshore firms and advisors. If a firm or individual from outside Canada is trying to open an account for you, wants to give you trading or investment advice or is offering an investment, be extremely wary. Brokerage firms need to register with your province or territory as dealers or advisors to open trading accounts or recommend investments.
- Anti-establishment. Any individual who encourages you to subvert the government or avoid financial institutions is most likely trying to keep their illegal activities from being tracked.
- Cutting out the paper trail. Without documents for investment purchases, statements or a prospectus, a fraudster can easily take your money without being detected.
- Avoiding the question. If the person selling you the investment doesn’t answer your questions or they use diversionary tactics, they’re probably trying to keep you from seeing the truth. A legitimate investment advisor has nothing to hide.