Financial Literacy Newsletter - March 2021

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Preventing financial fraud

A few words from FCAC

The Financial Consumer Agency of Canada (FCAC) is pleased to participate in Fraud Prevention Month. Taking place every year in March, this education campaign brings together organizations - including government departments and agencies, law enforcement, consumer and volunteer groups, and businesses - with the aim of helping Canadians recognize, reject and report fraud. This year’s theme is online fraud and we encourage you to join the conversation by using hashtag #FPM2021.

In this special edition of the newsletter, we focus on types of financial fraud and ways Canadians are being impacted. We also include information and links to valuable resources to help you prevent and protect yourself and your family from fraud. FCAC and the Government of Canada also offer a wealth of information about financial and other types of fraud including identity theft and other threats or scams.

As March also marks Global Money Week (March 22-28), an international campaign promoting youth financial literacy, we’ve included an article on starting the money conversation with kids. This article points to some great resources and a competition for kids – but hurry, the deadline is fast approaching!

March is also a month that many Canadians start thinking about preparing their income tax return. For many, doing their taxes may be a bit different this year due to the impact of the COVID-19 pandemic. Canada Revenue Agency (CRA) has an informative webpage CRA and COVID-19 changes to taxes and benefits to help you as you prepare your 2020 tax return. The newsletter also includes information about the Community Volunteer Income Tax Program—virtual tax clinics available to eligible Canadians where their income tax returns can be prepared for free.

Are you familiar with the terms open banking and fintech? The Government of Canada is currently reviewing the potential of introducing open banking in Canada. Open banking is a secure way for you to share your financial data with financial technology companies (often called fintechs or fintech apps). To help consumers understand open banking, FCAC recently published new web content on open banking and updated its content on fintech apps. In addition, FCAC is contributing to the government’s review of open banking and recently published its recommendations to ensure consumers are protected.

As always, we invite you to browse through FCAC’s tools and resources, check out the amazing content on our COVID-19: Managing financial health in challenging times webpage, as well as browse the resources and events in the Canadian Financial Literacy Database.

If there’s something in this newsletter that you enjoy, please share it with your network and remember to connect with us on social media via Facebook, Twitter, and Instagram – we’re also on YouTube and LinkedIn.

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What’s new

1 in 3 Canadians are targets of financial fraud during the pandemic

Fraudsters have found opportunity in the COVID-19 pandemic and are preying on peoples’ fears and using misinformation. In fact, one in three Canadians indicated they have been targeted by attempts to obtain their financial information through phishing or hacking, according to data from a recent FCAC survey.

Fraudsters are very sophisticated and are counting on their victims to fall for their scam and provide them with information so they can steal your identify or your money. If you’re suspicious about information you receive electronically or via telephone, do your research before providing any personal information, answering any questions or clicking on links. Look up the information about the organization and contact them back at the publicly listed email or telephone number to confirm whether they are really the ones contacting you or whether it may be a fraudster.

Here are some tips to help you keep your information safe:

If you think you’ve been scammed or you’ve accidentally given your information to a scammer, you should:

If you’re a victim of fraud, it’s important to:

The Government of Canada has several sources for more information on fraud prevention and protection:

Unauthorized credit or debit transactions can happen to anyone

More of us are using our credit and debit cards to make purchases as a result of the COVID-19 pandemic. But with incidences of fraud increasing as well, it’s important to understand your rights if someone uses your card without your permission.

You also have certain responsibilities to make sure you are protected, including taking reasonable care to keep your account and PIN safe. Here are three things to keep in mind:

1. Protect your PIN

Keep your PIN secret. Never share it with anyone, even a family member. This means you cannot share your PIN with your spouse even if you have a joint account. Do not use a PIN that someone can easily guess, such as a birthday or telephone number, or keep it written down on the back of your card or on a piece of paper in your wallet. It’s also a good idea to change your PIN from time to time.

2. Report unauthorized use of your card right away

If your card is lost or stolen or you become aware of an unauthorized transaction, let your financial institution know right away. It’s a good practice to regularly review your credit and debit card statements to check for any transaction you didn’t make. Your credit card or debit agreement will tell you if you have to report the unauthorized transaction within a specific amount of time.

3. Exercise your right to an investigation

Even if the chip and PIN were used, your financial intuition cannot automatically hold you liable for the transaction until they complete an investigation. During its investigation, the financial institution should consider all factors that contributed to the unauthorized use of your credit or debit card account. It’s important that you work with your financial institution to ensure a positive outcome.

Watch FCAC’s video “Understand PIN Protection” to learn more about why it is important to protect your PIN.

Countering the tide of online fraud

By the Canadian Bankers Association

Fraud can happen anywhere, anytime and to anyone. From phishing scams and fake phone calls, to romance scams and email account compromises, criminals are finding new and sophisticated ways to steal money and personal information. That’s why fraud awareness and prevention are so important.

In today’s digitalized world, fraudsters have largely shifted their illicit activities online. Increased reliance on Internet-enabled services and online connection pre-dates the coronavirus pandemic, but as more and more Canadians migrate to cyberspace, the risk of cyber crime rises exponentially. Whether it is e-commerce and remote work, or digital banking and Zoom calls with family and friends, Canadians are spending more time online and thus should stay vigilant to prevent fraud.

Most scams have the same aim: to obtain access to a person’s data in order to misappropriate their funds, or in some cases, use identity deception to con them into sending money to an account controlled by the fraudster. Banks in Canada take extensive steps to protect their customers’ information and invest significant resources into their security infrastructure, including layered fraud detection and mitigation technologies. But in the digital era, security is a shared responsibility. Canadians have an important role to play in protecting their sensitive accounts and information, adhere to safe online practices, and distinguish between legitimate requests and attempted fraud.

The Canadian Bankers Association (CBA) and its member banks widely share information resources to educate Canadians of the latest scams and provide actionable tips on how they can detect and avoid fraud and practice effective cyber hygiene. The banking sector also collaborates with law enforcement, government departments and agencies, regulators, and other organizations to help Canadians stay cyber safe.

The CBA also dedicates a significant portion of its two financial literacy programs, Your Money Students and Your Money Seniors, to fraud awareness and prevention. Developed in collaboration with the Financial Consumer Agency of Canada, the programs not only help Canadians improve their financial well-being, but they also help them spot the signs of financial fraud and provide tips on how to protect themselves online. Despite a growing understanding that cyber security is essential in a digital world, some Canadians still need help understanding that simple steps can make a big difference in protecting personal and financial information from criminals.

The Your Money Seniors fraud prevention seminar, one of three seminars comprising the program, is the most popular module. The CBA has delivered over 60 sessions to more than 2,400 Canadians across the country, which shows the growing importance of fraud awareness and Canadians’ desire to ensure a safer future for themselves and their families.

There are many easy to implement actions to stay safe online. Start with these:

Graphic: Habits to keep you safe online
Text version: Habits to keep you safe online

Habits to keep you safe online

  • Create a "passphrase" instead of a password. Don't share this with anyone.
  • Check if the email sender is legitimate. Fraudsters may disguise their identity.
  • Beware of emails from people or companies that you do not know.
  • Do not click on links in any suspicious looking emails or reply to them. 
  • Only give your personal information to people and organizations you trust. 
  • Type in the address for internet banking and avoid clicking on email links. 
  • Only bank on secure websites with the padlock symbol in the address bar. 
  • Avoid public computers and WiFi for internet banking (e.g. cafés, libraries, etc.).
  • Keep your computer's security software up to date. 

Learn more at cba.ca/fraud.

The CBA recently partnered with the national Get Cyber Safe campaign to publish a helpful Cyber Security Toolkit to help consumers protect themselves from online threats.

For more information, visit: cba.ca/fraud. The CBA also publishes a fraud prevention newsletter with tips and information on the latest frauds and scams.

What every homeowner needs to know about title fraud

By First Canadian Title (FCT)

The increasing reliance on a digital landscape has created more opportunities for fraud, particularly within the real estate industry. For those who know the intricacies of the real estate and lending markets, title fraud makes for fast and easy money. If you own a home, you could be at risk.

What is title fraud?

It typically involves fraudsters using stolen identities or forged documents to illegally transfer the ownership or title of a property to themselves. They can then take out a new mortgage on the property and disappear with the money or register forged documents to sell the property, discharge the existing mortgage (if one is outstanding) and then get a new mortgage against the property’s clear title. All while the original homeowners are completely unaware.

Typically, homeowners only find out about title fraud once it’s too late. That may mean a lender who gave out a fraudulent mortgage is trying to foreclose on a home or in one case, an owner tried to pay his property taxes and was told that, according to municipal records, he no longer owned his home!

How can you protect yourself from title fraud?

Here are some tips to help keep you safe:

Why is title insurance important?

While you may take all the right precautions, there’s no guaranteed way to prevent title fraud. That’s where title insurance comes in. Title insurance protects you by covering the legal expenses and many other costs related to restoring your title, if you fall victim to real estate title fraud. It also saves you a lot of time and frustration. Even if you didn’t get title insurance when you first bought your home, you still have the option to buy it.

What should you do if you become a victim of title fraud?

If you suspect that you may be a victim of fraud, take the following steps immediately:

3 money concepts to start the conversation with kids

Parents and guardians, and even teachers, play a key role in teaching kids about money and helping them develop good money habits early. Helping young people develop the knowledge, skills, and confidence to manage money will help them throughout their lives and will contribute to their financial well-being as adults.

When kids reach their teen years, focusing on money matters becomes even more important as they will soon be considering their first credit card, signing a cell phone contract, or starting a part-time job.

We’ve identified 3 money concepts to help start the conversation.

1. Understanding money transfers

Electronic money transfers, or e-transfers, are an easy way to send money to others, or to receive it. It is important to understand that these transactions should be treated like cash, because they cannot be cancelled once they have been deposited by the recipient. When sending an e-transfer, youth should make sure to:

2. The importance of protecting personal financial information

It may be tempting for kids to download and use a third-party app to help them manage their money. With convenience, comes potential risks. It is important that they read the user agreement and understand how their information will be protected and potentially used by the app. For instance, some apps sell client information for marketing purposes.

Even if the app promises to protect their information, it’s still their responsibility to keep their personal financial information safe. Sharing personal financial information could mean that no matter what security features the app has in place, their financial institution may hold them responsible for lost money because of unauthorized transactions or fraud.

3. Start saving early

Getting into the habit of saving when young will pay rewards in the long run. Whether their income comes from an allowance, doing odd-jobs or a part-time job, kids who regularly save a portion of their earnings are developing a good habit that will help them throughout their lives.

The great part? It does not have to be a big amount – saving regularly is a key element to improved financial well-being. For younger kids, setting up “save” and “spend” jars at home will get them into the habit of putting part of any money they get into their “save” jar. They will also visually see that money adding up.

For kids with a part-time job and a bank account, they can set up an automatic savings program. This will move a pre-set amount of money into a separate savings account every payday. Most people don’t even miss the money being transferred and they soon have a savings account to help out with unexpected expenses or a special purchase.

Here are some additional resources to help you start the conversation with kids:

Get your taxes done at a free virtual tax clinic

By the Canada Revenue Agency

Free tax preparation is a vital service provided to eligible Canadians who need help with their income tax returns. You might be able to get your tax return done for free by volunteers at a free tax clinic:

To find a clinic near you, go to canada.ca/taxes-help.

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