Digital fraud: Be aware, take charge!

person at computer committing digital fraud

March 2, 2020

It’s Fraud Prevention Month, and this year’s theme is digital fraud. That covers a huge range of fraud activities, so we decided to speak with an expert at the Canadian Anti-Fraud Centre. We wanted to know: what are the most common forms of digital fraud, and what are some emerging ones? We spoke with Jeff Thomson, Senior RCMP Intelligence Analyst and Acting in Charge of the Fraud Prevention and Intake Unit. Here’s an edited version of our conversation:

FCAC: What is the most prevalent type of digital fraud in Canada right now?

Jeff Thomson: There are many. But last year we saw a huge spike in identity-theft-related reporting. This includes:

  • Telephone scams soliciting personal information
  • Digital phishing scams via email or text, soliciting personal info, which can lead to SIM swapping

FCAC: What does SIM swapping involve?

Jeff Thomson: Increasingly, fraudsters are using your personal information in what’s called a SIM swap scam. You might get an email or a text saying your phone company has qualified you for a year of free data. The link takes you to what looks like your phone company’s page, but it’s a fraudulent page. You register at the bottom and the fraudsters use this registration to contact your phone provider, say you have a new phone, and essentially swap your SIM out for their own. 

FCAC: How long does it take people to realize this has happened to them?

Jeff Thomson: Well basically your phone will go dead. So, it depends on how often you use your phone. Often it happens on a weekend, which makes it a bit harder to get hold of your phone company. There has been a definite uptick in SIM swap reporting (recently), and it’s still on the rise.

FCAC: We’ve also been hearing about something called “synthetic identity fraud,” what exactly is this?

Jeff Thomson: Yes, it’s a big industry as well. Fraudsters compromise enough of your personal info to create a fake identity, either in your name, or sometimes, they use the identity of newborns or deceased people, by gaining access to their SIN numbers. They use these details (often combining details from more than one person) to create a fake identity, and open up new accounts in that name. 

FCAC: How is it that they aren’t caught? Is it because SIN numbers are hard to check against names?

Jeff Thomson: Yes, it’s all done through the credit system, and they will have enough to create a credit account using a SIN number, bank account number, and name. Then, they let that account sit there for a year or more to build up its credit rating, making small purchases that they pay off. That drives up the credit limit of the profile.

FCAC: It seems really time-consuming, does this pay off?

Jeff Thomson: They work on weekends and we don’t (laughter). Yes, it’s sophisticated and, to some extent, labour intensive.

FCAC: So basically, people build up their credit and then they go and use that credit and then they disappear? How hard is it to catch those people?

Jeff Thomson: It’s very difficult. You’re chasing a ghost essentially. It’s a completely fake ID.

FCAC: Are there any other new scams people should know about?

There is the evolution of Canada Revenue Agency (CRA) system scam, which has morphed into fraudsters calling to say they represent Service Canada. They say there’s been a fraud and they want you to provide your SIN number, address and date of birth. 

(The older CRA scam involved phone calls impersonating a CRA officer, and claiming a person owed back taxes, which led to a request for cash).

FCAC: What are the basic messages you want the public to remember as they go about their lives online?

Jeff Thomson: We stick to: “Recognize, reject, report.” That is to say, recognize that scammers are using the internet, social networking, text messaging, internet advertising, emails, and telephones to try to scam you. So, take five, don’t react, and if an offer is not sitting well or there is high pressure, reject it. Take some time to do some due diligence on the offers and the requests. Talk to friends. And finally, reporting is key! If it’s not being reported, we don’t know it’s happening. The information you have could be a missing piece for law enforcement.

FCAC: Thanks for your time today!

Jeff Thomson: You’re welcome.

What do to if you’re a victim of fraud

If you think you have been a victim of fraud, here are some steps you should take, according to the Canadian Anti-Fraud Centre.

The Canadian Anti-Fraud Centre is the central agency in Canada that collects information and criminal intelligence on all kinds of fraud. It is a joint collaboration between the RCMP, the Ontario Provincial Police and the Competition Bureau. You can contact them toll-free at 1-888-495-8501.

For more information on protecting yourself from frauds and scams, visit Canada.ca/money.

 

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