March is Fraud Prevention Month in Canada, with the federal Competition Bureau creating a number of targeted initiatives to ensure Canadians are aware of best practices to prevent a number of types of frauds and scams. As highlighted in a press release from the Bureau, our increasing dependency on digital communication has only increased our susceptibility to various scams and it’s more important than ever to make awareness and vigilance a priority for both individuals and businesses. As a firm with considerable experience litigating civil fraud claims, we want to take this opportunity to highlight some key information to make it easier to detect and prevent fraud.

Recent Canadian Fraud Statistics

According to the Canadian Anti-Fraud Centre, the number of victims and the financial impact of fraud is staggering. The Centre reported the following numbers for 2020:

• 69,411 reports of fraud
• 41,007 confirmed victims of fraud
• $107.5 million lost to various frauds and scams

Even though we are barely three months into 2021, already there have been over 10,000 reports of fraud and almost $35 million lost.

Fraud in 2020: COVID Creates New Opportunities

Perhaps the biggest change in fraud over the past year is the number of scams created to take advantage of the vulnerabilities created by the COVID-19 pandemic. Early on, one of the biggest issues was a scarcity of necessary products such as disinfectants and personal protective equipment. Some people purposefully made attempts to hoard these items and resell them at a steep premium; a practice that soon became punishable by fines or even jail time.

However, this didn’t stop others from creating products marketed as legitimate means to combat COVID, despite having no scientific information to back the claims. Fraudsters marketing medical devices, natural health products and hand sanitizer that, at best, was ineffective and at worst, had the potential to create their own health complications. One of the best ways to ensure the items you’re purchasing are safe and effective is to be wary of potentially false claims and to consult with a health professional if you’re unsure.

Financially speaking, many people faced economic difficulties as a result of various shutdowns, layoffs and other hardships, and continue to do so. To address this, the federal and provincial governments introduced a number of subsidies for individuals and businesses to help people bridge the gap while earnings and income were down. While these subsidies have been a much-needed hand for many, they also created a new opportunity for fraudsters to take advantage. Scams ranged from text messages and emails asking people to apply for CERB and CESB (while providing their financial information in the process), or demands to repay funds that were legitimately received. The government has said that it will not use texts or emails to reach out for these purposes, so if you receive these communications, it’s best to assume it might be a scam. If you’re unsure, contact an official office through legitimate means yourself to confirm.

How to Prevent Fraud Before it Happens

The Canadian Anti-Fraud Centre has provided a number of tips for both individuals and businesses to prevent and detect fraud before they fall victim. Below are some of the key highlights.

Fraud Prevention for Individuals

• Don’t act hastily: If you think you are being pressured to react quickly to a request for information or money, listen to your instincts. Ask questions and, if you’re in doubt, say no.
• Don’t give out personal information: It’s easy for scammers to make themselves look like a legitimate business, such as a bank. But if you’re ever contacted and asked to provide personal details or login information, verify the request before you proceed any further.
• Use strong passwords: When creating a new online account or changing a password, use something unique and difficult to crack. While maintaining passwords can be a chore, it’s worth the effort.

Fraud Prevention for Businesses

• Watch for red flags: pay attention to your accounts and be sure to follow up on anything unusual, such as large purchases, or multiple orders from the same vendor.
• Beware of unsolicited calls and emails: educate employees on phishing scams and fraudulent phone calls, and ensure that they are aware they shouldn’t give out any sensitive information about the business, clients or financial information without authorization.
• Limit employee authority: employee fraud is an ongoing threat to all businesses, and it’s important to limit the number of people with the authority to approve purchases, access accounts and pay vendors.

Click here to view the full list of tips.

Federal Tools to Aid With Prevention and Awareness

The Competition Bureau has created and highlighted a number of tools and resources to help people and businesses increase their awareness of potential scams and how to detect them, such as:

• A list of the top ten scams affecting Canadians from the Better Business Bureau;
• A site where the Bureau lists alerts to the public about new potential scams; and
• A quiz to test your awareness of scams.

It’s also important to note that the elderly are common targets of scams. If you have family or friends who you think would benefit from detection and prevention tools and information, be sure to share the above with them.

Contact Milosevic & Associates in Toronto for Experienced Representation in Civil Fraud Matters

If you have a question about civil fraud or similar issues, the highly skilled Toronto corporate lawyers at Milosevic & Associates can help. We can provide you with advice and guidance suited to your unique situation, and we work proactively to help clients limit losses whenever possible. Call us at 416-916-1387 or contact us online to learn more about how we can help.