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With modern technology rapidly developing, financial scams have never been more dangerous. Becoming prey to fraudsters can cost immigrants a fortune, and victims often struggle to report fraudulent crimes. Learning to tell the difference between a scam and a genuine offer can help save newcomers from making devastating financial errors.
What is a Financial Scam?
A financial scam is any fraudulent activity performed by a cybercriminal who hopes to take money from the target. The most common types of scams include:
- Identity theft: A fraudster attempts to steal personal information, granting them access to bank accounts, credit cards and government benefits. They may pose as government officials that need urgent information.
- Phishing: A fraudster sends an email or text message with a link that appears to be a legitimate banking or company website to lure victims into providing personal information.
- Investment scams: Fraudsters use unsolicited emails to trick people into putting money into a fake investment. They will use “too good to be true” language and make bold promises. There will also be no information about the company online.
- Copycat government websites: Cybercriminals create websites similar to official Government of Canada websites. They may ask for high fees to process official paperwork, like visas. Â
Why Financial Scammers Target Immigrants
According to the Government of Canada’s website, permanent residents in Canada are protected by laws concerning fraudulent activity. However, immigrants are also more vulnerable to disingenuous financial fraud as they may struggle with language barriers and may not be familiar with how Canada’s government and organizations operate.
In other words, immigrants are less able to tell the difference between genuine and fraudulent communication.
Moreover, the University of Toronto notes newcomers are more vulnerable to scam attempts than citizens. Fraudsters have more to “work with” when targeting an immigrant. They draw inspiration from the concerns of vulnerable newcomers and plot schemes accordingly. Some examples include:
- An email or call declaring that Service Canada is accusing you of a crime related to your immigration status.
- Calls or emails claiming the government will revoke your visa status if they don’t receive payment.
- Calls or emails that claim Immigration, Refugees and Citizenship Canada (IRCC) need to collect a fee or fine.
- Calls or emails claiming you owe money for filling out official Government of Canada forms.
- Calls or emails from criminals posing as government employees while you are applying for citizenship or permanent residency. Fraudsters may ask for information or payments that you have already provided.Â
How to Detect a Scam
Learning how the Canadian government and financial institutions communicate is the best way to avoid financial scams.
For example, the Government of Canada will never:
- Ask for payment via e-transfer, prepaid credit card or cryptocurrency.
- Ask to meet in public.
- Use threatening language to force payments.
- Send a text message with a link promising a tax refund or a link that asks for personal information.
The Canada Revenue Agency (CRA) rarely sends text messages unless it is to verify an account. They may send emails that direct you to log into your CRA account to view information.
In the rare case of an agent calling you, you should ask them to confirm their identity, hang up and verify them with the CRA before calling them back.
Furthermore, your bank of choice will never text or email you a link asking to urgently verify personal information. This is a common phishing attack performed by cybercriminals. Investopedia notes that you should immediately block texts or calls from unknown numbers.
Banks may send marketing emails or letters about new products and services but do not include suspicious links. Some signs that a link is suspicious include shorter URLs, the use of hyphens and symbols, too many numbers, and unfamiliar or partially unfamiliar domains (the part of the link that follows http://).
Your bank will often choose to communicate using a secure inbox only you can access when logging into your account.
How to Report a Fraud
Immigrants can report financial fraud to the Canadian Anti-Fraud Centre (CAFC) online or by telephone. The CAFC works with local law enforcement officers to investigate reports. Victims can also file a complaint with their financial institution, depending on the type of illegal activity.
Unfortunately, these investigations are complex and may take months or years to resolve. This means that victims often have no way to recoup lost money and often have to accept the blow.
However, in the case of an unsatisfactory investigation, victims of fraud can escalate a complaint to a regulatory external complaints body. Canadian banks, for example, are either a part of the Ombudsman for Banking Services and Investments (OBSI) or the ADR Chambers Banking Ombuds Office (ADRBO).
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