Scams and how to report

Grandparent or emergency scam

In this scam, a con-artist phones and pretends to be your grandchild. The caller will say they are in trouble and need money right away. He or she may say they are in a hospital, stuck in another country or have gotten into trouble with the law.

The scammer may have looked up personal information about you and your family members, such as names and birth dates, to make their call sound legitimate.

The scammer’s goal is to pressure you to send them money as soon as possible without verifying the situation. To do this, they often:

  • act very emotional on the call (e.g., they may cry or sound scared)
  • try to disguise their voices by faking a bad phone connection
  • ask you not to tell anyone in the family about the call (they may claim that other family members will blame or punish them for the accident or emergency)
  • insist that you wire them money immediately

To avoid an emergency scam:

  • hang up and call your grandchild directly, or another family member, to find out if there is a real emergency
  • consider developing a secret code word with family members (if you get a call about an emergency, ask the caller for the code word)
  • don’t disclose any personal information over the phone unless you initiated the call
  • never wire money unless you’re absolutely certain that you’re sending it to someone you know (wiring money is like sending someone cash — once it’s gone, it’s gone)

Romance Scam

A romance scammer uses dating websites, social networking websites or meets in person to defraud people. They communicate using fake photos and profiles. They share phony details of their lives and intentions until they’ve gained your trust.

Then the scammer will make up a story to ask you for money. For example, they may claim to need money for a medical emergency or to cover the expenses of a civil court case.

Sometimes, the scammer doesn’t ask you for money directly. They may instead ask for help cashing a cheque, for example. In this case, they will forward you a counterfeit cheque and ask you to send back cash via a wire service.

Romance scammers can be very patient. They may correspond with you for weeks or even months before asking for money. During this time, they may talk to you on the phone or even send you small gifts to build your trust.

Do your research before engaging with someone online (check their name, the company they work for and the country code of the phone number they give you).

To avoid a romance scam, be wary of an acquaintance who:

  • asks for money or for cheques to be cashed
  • asks for a small gift (this is sometimes a test to see if they are dealing with an ideal target)
  • quickly leaves a dating site and asks to communicate in another way, usually by instant messages or email
  • avoids talking on the phone and/or talks to you on a bad phone connection (this may be an attempt to disguise their voice)
  • claims to have fallen in love with you after a very short period of time — often a couple of weeks — and without ever meeting in person
  • tries to isolate you from family or friends, saying that others may not approve of the relationship and will try to break it up
  • asks for provocative photos or asks you to perform suggestive acts on camera (the scammer may save this material and use it later on to extort money)
  • constantly makes excuses about why they can’t meet in person, or agrees to meet in person and then cancels at the last minute
  • has only a few photos of themselves and makes excuses about why they can’t share more photos with you
  • claims to be a member of the military (many romance scammers impersonate soldiers and other people in positions of trust)

Charity Scam

Phony fundraisers can contact you through the mail, e-mail, telephone, or by knocking on your door. They claim to represent a charitable organization that may have a similar name to a legitimate charity. Once you make your donation, there is usually nothing you can do to get your money back.

To avoid a charity scam:

  • ask for and check the charity’s registration number online
  • call the Canada Revenue Agency toll free at 1-877-442-2899
  • never give out personal or financial information over the phone or at the door
  • research the charity and ask for the information to be sent to you in the mail before you donate
  • ask questions before making a donation such as:
    • how much of your gift will be used directly for the charitable work?
    • how much will go toward administrative costs?
    • can I get a tax receipt?
  • give your donations to established charities you are familiar with and don’t pay in cash
  • beware of anyone who thanks you for a pledge you haven’t made

Gift card scam

Scammers steal the information from unsold gift cards and use it to buy items. If you buy one of these compromised cards, you may be told there’s little or no balance left on the card when you go to use it for the first time.

With this scam, fraudsters usually copy the numbers off the back of a gift card they see on a store rack. A few days later, they will call the customer service number to check whether it’s been sold and activated, and to get information on the balance value.

If it’s been activated, they will use the card number to buy items online.

To avoid gift card scams:

  • buy gift cards from behind the cashier counter
  • opt for gift cards that have a protective backing or a scratch-off PIN number
  • check the packaging or the back of the card for tampering before you buy it
  • always keep your receipts, which will usually show the card number and how much you have paid

Employment scams

These scams usually advertise high paying employment or business opportunities, but guarantee very little in your contract with them. So make sure you ask questions and understand what you’re signing up for. If the offer sounds too good to be true, it probably is.

Mystery shopper scam

You see an ad describing a need for a position to act as a “secret” or “mystery” shopper to evaluate companies’ customer service skills and how well they adhere to procedures.

If you respond to the ad, you receive a letter outlining a training assignment and including a cheque to help you complete it. The training assignment is to deposit the cheque into your bank account, pose as a shopper and then use wire transfer to send the balance of the cheque’s proceeds (after you complete the assignment) to a name provided.

The cheque will be fake. So when it bounces — which occurs after the money is wired — you are accountable to your financial institution for the entire amount of the fake cheque, plus any additional penalty fees.

Expensive job supplies

A fake company will offer you what appears to be a well-paid job, but say that the offer is conditional on you first sending them money for job supplies you’ll need to use right away (e.g., uniforms, special software or tools). Once you send them the money for these so-called supplies, you never hear from them again.

Costly job training

Look out for job ads that require you to enroll in a company’s training or certification programs. They may guarantee employment and high starting salaries within the company. Often it’s a way for them to make money from the students, and even if you try to find work elsewhere, legitimate employers may not recognize the certification.

Phoney employment agency

Fake employment agencies may contact you using information from a résumé you’ve posted on career websites. They may also call you posing as headhunters who claim to be “screening” on behalf of an employer.

Job hunters are invited to interviews and promised employment with high salaries. They are then pressured to sign a contract and asked to pay a retainer or initiation fee for the job placement service. The victim will never hear from the company again, or will be told to attend meetings with companies that have never heard of the agency and have no work to offer.

Bogus business opportunities

A fake company will advertise specialized business opportunities, such as office cleaning, promising clients in exchange for an upfront investment fee of several thousand dollars. The paperwork may show you as a “partner” or “sub-contractor” and you may even be encouraged to register it as your own business. They may even guarantee clients within a specific timeframe or the investment fee will be refunded.

Make big profits working from home

Ads like these are designed to scam people into low-paying work like stuffing envelopes or making cheap handicraft products. They may even ask you to pay in advance and deliver low-quality materials to work with.

Foreign job scam

Be extra careful about ads promising jobs in foreign countries. The information they give you may not always be easy to verify due to language and other barriers.

The scammers may conduct fake interviews in hotel suites or rented offices while posing as foreign recruiters or agents. They will then offer you a position but require up-front payment to process visas and other paperwork.

Scammers may also pose as recruitment agents and sell you a bogus information package to help you find a job abroad.

To avoid an employment scam:

  • be cautious if you are asked to pay an up-front fee for a job or business opportunity
  • don’t give personal information to anyone unless you’ve been offered a job in writing and receive a copy of the contract, especially if the transaction was online and you have not visited the workplace in person
  • be wary if the company uses high-pressure sales techniques
  • avoid calling a special number from ads (it could be a long-distance line that bills you at a costly rate per minute)
  • ask for references of previous clients of the company and check them
  • make sure the place where you’re being invited for an interview is a regular office or other business location (if it’s outside regular business hours, don’t go alone and make sure you tell someone where you’re going)

Get-rich-quick schemes

These are typically investment schemes that promise extremely high rates of return with no apparent risk. They’re usually vague about the nature of the investment and focus mainly on the rates of return.

The Ontario Securities Commission (OSC) and the Investor Education Fund have information on what to consider before you invest your money.

Pyramid schemes

Pyramid schemes are illegal in Canada. These scams start with one person or a few people (those at the top of the pyramid) who sign up others to invest in a fake business. These new members pay to join the scheme and are expected to bring in more people to invest in the business. Each time a new member pays to join, those higher up on the pyramid get a cut of the money.

At some point, every pyramid scheme reaches a point where no new investors can be found and the last investors, those at the bottom of the pyramid, lose their money.

Consultant fee scam

It is illegal for a business or individual to charge a fee and offer you a benefit, right or protection that is already yours under the Consumer Protection Act.

For example, you don’t need to pay an extra “insurance” to make sure your costs are within the agreed amount with a contractor. Under the CPA, if you have a contract over $50 and it includes an estimate, the final cost can’t be more than 10% of that estimate. It’s illegal to charge you a fee to protect this right.

Other consultants may charge you a fee promising you to help clear your credit record or for brokering a loan. The CPA has rules about how they can charge you.

If you’ve been scammed

If you think you may be a victim of a fraud or scam, there are some key steps you should take immediately to reduce your risk of losing more money, protect your personal information and avoid being scammed again.

You can consider taking legal action against those involved in the fraud or scam. If you don’t have a lawyer, you may contact the Law Society Referral Service. They provide up to one-half hour of free legal consultation.

You should:

  • stop all communication with the fraudster or scammer
  • avoid making any major financial decisions until you feel you’ve taken action to secure your accounts
  • gather all records you have of the fraud or scam, such as:
    • correspondence with the scammer (e.g., letters, emails, text messages)
    • financial statements
    • receipts
    • contracts
    • contact information the scammer used to contact you (e.g., phone numbers, email addresses)
    • websites and social media accounts used for the scam (print out hard copies)
    • any papers, marketing material or ads used for the scam (e.g., brochures, flyers, copies of ads on classified sites)
  • avoid touching documents that the scammer may have touched, and protect them with a plastic case or cover
  • notify financial institutions and other companies where you have an account that may have been affected
  • change passwords to accounts that may have been affected, including social media sites
  • document your actions if you contact law enforcement, financial institutions, and other agencies (e.g., notifying your bank, changing your banking passwords), starting from when you first noticed the fraud in a log (include dates, times, names and contact information)
  • protect your devices if you used your computer, laptop or tablet to communicate with a scammer:
    • take your device to a professional to have it checked it
    • ensure security software on your device is up to date
    • install anti-spyware protection
    • scan your hard drive and files
  • put an alert on your credit report by contacting Equifax Canada or TransUnion Canada

Report a fraud/scam

You should contact:

  • local police — file a report about the fraud or scam, and make sure you get a report number for future references
  • Canadian Anti-Fraud Centre — provides valuable assistance to law enforcement agencies by identifying connections among seemingly unrelated cases
  • regulatory bodies — when it involves a member of a regulated profession such as a doctor, lawyer or mortgage broker (regulatory bodies may have the ability to take disciplinary action, such as revoking a person or company’s licence or ordering them to stop providing services to the public)