Protect yourself against the top 5 scams of 2023

March is Fraud Prevention Month, and we’re examining some of the top scams Canadians need to be aware of in 2023. 

According to the Canadian Anti-Fraud Centre, social media is increasingly a site for fraudulent activity, and investment scams remain a concern to look out for. According to reports, these and other scams cost Canadians over $530 million in 2022, a significant increase over the 2021 amount of $384 million.

1. Investment scams

Be cautious of unsolicited emails from strangers that promise unusually high rates of return.

Always be suspicious of:

• Unsolicited investment opportunities (even from friends and family)
• Higher-than-normal returns on your investments
• High-pressure tactics
• Cryptocurrency websites
• Requests for cryptocurrency payments

Watch out for:

Never rely on the websites and phone numbers included in unsolicited information. Do a web search on the investment being offered to check if any scam alerts come up. You can also verify the investment with your provincial/territorial securities regulators, such as the Manitoba Securities Commission.

Signs point to more investment scams in 2023—especially with the increased popularity of cryptocurrencies. These currencies are part of the new banking era and are easily exploited by fraudsters. The Canadian Anti-Fraud Centre (CAFC) warns that cryptocurrency transactions don’t have the same legal protections traditional currencies do , so it’s always important to do your research. This Fraud Prevention Month, consider that cryptocurrencies increase your risk of having your personal information compromised and losing your hard-earned money.

2. Social media scams 

In the digital age, it’s common to connect with people we’ve never met in person—something scammers frequently take advantage of. It’s easy to pose as an acquaintance online and ask a small favour, which could then lead to identity theft and stolen passwords.

A Calgary man was recently hacked after a contact reached out on Instagram asking for help setting up a new account. All he had to do was copy a link. He quickly found himself locked out of his account, and eventually his images were being used to promote a cryptocurrency scheme.

Protect yourself:

A common tactic used in social media schemes is false advertising. Look out for anything that appears too good to be true, such as free trials, discounted merchandise and incredible job opportunities. Be wary of fake accounts, which are a red flag for scams.

Remember, when scammers gain access to your social media profile, they also gain access to all the information associated with it, such as passwords and other sensitive data. This can be used for:

• blackmail
• identity theft
• publishing fake ads
• targeting others on your contact list

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Read about these top fraud prevention tips for 2023

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3. Spear phishing scams 

Be aware of texts and email messages from scammers pretending to be from a legitimate source saying that someone is trying to access your account. Never respond to the text or email, and do not click on any links.

What should you do?

If you’re concerned about these messages, especially if they are ongoing, call your financial institution directly to find out if they’re trying to get in touch with you.

4. Merchandising scams 

Whether you are selling or buying, merchandising scams can trick even the savviest shoppers. These schemes aim to trick people who are buying or selling goods online.

When it comes to online transactions, be on the alert if someone sends you a cheque for more than the agreed amount. Likewise, if there’s a sense of urgency from the other party that seems unreasonable, you might be better walking away. The golden rule applies here: if it’s too good to be true, it’s likely a scam.

Learn the warning signs:

• People who are not “authorized” sellers
• Spelling mistakes in the web address and on the website
• Blowout sales or greatly reduced ticket prices
• Unknown fees involved
• Company’s contact information (address, phone number, email) should be verifiable

5. Employment scams 

The Canadian Anti-Fraud Centre reports a rise in scams targeting people looking for a job, with increasingly sophisticated methods, from unsolicited email offers to fake hiring managers “working” for prominent companies on LinkedIn.

A job offer may be followed up with a cheque to set up a home office, and a request to wire transfer money to an office equipment retailer. As in the recent case of a Toronto man, it’s all part of an elaborate plot to raid bank accounts.

Other common fraudulent employment schemes include:

• An offer to participate in “car wrapping,” or wrapping your vehicle with a logo. Fraudulent cheques are offered as compensation, and victims are asked to deposit the funds in a bank account to pay for graphics—only to learn the cheque bounced and they are on the hook for the money
• Getting hired as a “Financial Agent” to process invoices for a client. This can be a front for a money laundering plot involving cryptocurrency
• Receiving a notice that you’ve been selected as a mystery shopper or personal assistant. A cheque and instructions to transfer a large portion of the money into another account follows. Commonly, customer experience surveys are sent out to make the job appear more legitimate

Here’s how to defend yourself against employment scams

• Practice healthy skepticism: Be wary of any offer that seems “to good to be true”
• Do your research: Look online for contact information for the company that supposedly reached out, and get in touch to confirm
• Beware of requests to transfer funds: Legitimate employers will not ask you to write cheques or send wire transfers

Don’t forget tax scams

With tax season creeping up, expect an increase in fraudsters posing as Canada Revenue Agency or Service Canada employees. They may claim that you have a compromised SIN number, an outstanding case against you, owe back taxes, have unpaid balances or have even committed a financial crime.

The fraudsters may threaten that if you do not speak to them immediately, you’ll be arrested, fined or deported. They may also request payment via money service businesses, prepaid cards and gift cards (iTunes, Google Play or Steam cards) or even Bitcoin. While this can be shocking and scary, do not take the bait.

Remember, the CRA will never request payment through any of these methods, and it is fully within your rights to hang up and verify any of these claims by calling the CRA directly.

Armed with this knowledge and ready to proactively avoid the scammers, you’ll be safer online. To get extra protection, learn about SIM swaps and how to prevent smartphone fraud. Then explore these 17 tips to protect your ACU account from online fraud.

Stay smart and get ahead of the scammers this Fraud Prevention Month.

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