Fraud Prevention: Common Scams You Should Watch Out For

Scammers can target any Canadian or Canadian business and go to great lengths to do so. Last year was a historic year for financial losses reported to the Canadian Anti-Fraud Centre (CAFC). Based on reports to the CAFC, $379 million were lost to scams and fraud in 2021 (Royal Canadian Mounted Police, 2022).

Remember, if it seems too good to be true, it is. Here are some common scams to look out for.

Phone scams.

Many scams attempt to imitate government services to gain access to your personal and financial information. Click here to identify legitimate communications from the Canadian government so you know what to expect if they contact you.

Scammers use phone calls to trick you into sharing your personal information. They often use technology to make a call appear to be coming from a name and number you will recognize so you are more likely to answer. As soon as you realize you don’t know the caller, or they ask for money or any personal information, hang up.

Red flags to look out for:

  • A robocall
  • A call from a phone number and person you don’t recognize
  • An unsolicited caller asking for personal information, such as your social security number, and bank and credit card information.
Employment scams.

Employment scams involve jobs offering easy money, high wages, flexible working hours, or exciting future opportunities. Criminals often use online channels, including email and social media, to offer opportunities that may sound amazing, but in reality, they’re using the offer as a way to get your information. Victims of these kinds of fraud scams are often called money mules.

Red flags to look out for:

  • A job offered through social media, email, or text with little to no recruiting process
  • A job that involves depositing cheques or transferring funds
Business email scams.

In a business email compromise scam (BEC), a fraudster poses as someone the recipient should trust — typically a colleague, boss, or vendor. They ask the recipient to make a wire transfer, divert payroll, change banking details for future payments, and so on.

BEC attacks are difficult to detect because they don’t use malware or malicious URLs that can be analyzed with standard cyber defenses. 

BEC scams use a variety of impersonation techniques, such as domain spoofing and lookalike domains. 

Red flags to look out for:

  • A request involving an address or bank account that you’ve never used before and don’t recognize 
  • A request that involves excessive urgency and persuasion
How to avoid scams and protect yourself.

There are so many scams targeting innocent individuals and businesses. Luckily, there are some common steps you can take to protect yourself:

  • Use strong, unique passwords for each online account, and enable two-factor authentication when available. This extra layer of security is used to make sure people trying to gain access to an online account are who they say they are. Instead of immediately gaining access to an account with an email and password, they will be required to provide another piece of information. This second factor could come from one of the following categories: something you know (this could be a personal identification number (PIN), a password, or answers to “secret questions”), something you have (typically, a user would have something in their possession, like a credit card, a smartphone, or a small hardware token), something you are (this category is a little more advanced, and might include a biometric pattern of a fingerprint, an iris scan, or a voice print)
  • Avoid giving out personal information. Don’t give out any information you don’t need to, especially information that is not publicly available such as social insurance numbers and account numbers.
  • Shop smart online. Look for “https” in the web address you are accessing, along with a lock icon, which indicates a secure payment. When possible, pay with a credit card or use a third-party payment provider, such as PayPal.
  • Limit what you post on social media. Scammers can use your social media to discover personal information about you. Mentioning your favorite food or your pet’s name could help identity thieves answer knowledge-based questions and access your online accounts. Don’t connect with people you don’t know and update your privacy setting to control who can see what.

It’s unfortunate to live in a society where we must be skeptical of everything we hear and see, but it’s better to protect yourself and avoid being a target. Be mindful of sending personal or financial information and think twice if something feels off. Remember, if it seems too good to be true, it is. If you think you’re being scammed or notice strange activity, always report it. To learn how your own policy could protect you or your business in the event of identity theft or a cyber security breach reach out to your licensed insurance broker today.