Fraud occurs when someone dishonestly deprives someone else of a possession. While anyone of any age can be victimized, women, seniors and people with disabilities are usually the targets. Financial abuse is the most prevalent type of abuse against the elderly, affecting more than 60,000 seniors in Canada. In over 90% of the cases, the perpetrator is unknown to the victim.
Here are some common con games or frauds, as well as
commonly used expressions and some prevention tips:
The Bank Examiner or Inspector:
An individual claiming to be a bank examiner or inspector contacts you and requests your assistance and co-operation in helping them uncover a suspected dishonest bank employee. You are asked to withdraw a specified amount of cash from your account. The "bank examiner" takes your money, supposedly to check the serial numbers. You never see the phoney bank examiner or your money again. If you are asked to participate in such a scheme contact the police and your bank immediately, particularly someone you deal with often.
An individual claims to have found a large sum of money and offers to share it with you. You are asked to withdraw "good faith" money from your bank. The con artist may either request that you simply show the money by placing it in a particular wallet, later switching the wallet with one that does not have any money in it, or the con artist takes your good faith money and gives you a phoney address where you are to collect your share of the found money. Either way, the end result is you lose your "good faith" money. Always refuse to participate in any deal requiring you to demonstrate your financial ability to a stranger.
The Pyramid Scheme:
The pyramid scheme is described as "transfer of wealth". The con artist tricks an investor into believing the money is being invested into something like commodities or managed investment accounts. The con artist, rather than investing it, issues paper profit statements and hopes investors don't demand actual payments. If someone does demand a payout, the promoter will take new investors money to pay off others, basically robbing from Peter to pay Paul.
Two or more people knock on your door. One person claims to need your help, which requires you to leave the entrance way. While you are away helping this person, the other person(s) enter your home and take what they can before you return. It could be days before you even realize you have been robbed. Never leave strangers unattended in your home. These are commonly referred to as "gypsy scams".
Take preventative measures to avoid undue repair bills. For instance, read your owners manual and learn about the servicing requirements of your vehicle. If you do have to get your car serviced, it is your responsibility to find a reputable repair shop. Don't walk into the shop and say "my car isn't running right". Specifically describe the symptoms to the manager and insist on a written repair order. Do not sign the repair order until you have read it and understand exactly what it says. If at all possible, have a third party accompany you and request to the manager that if any further costs are required that you be contacted before any repairs are started. This third party observer can not only help you with describing necessary repairs, but he/she can attest to your agreement with the repair shop. Finally, NEVER give a repair shop (or anyone else) a blank cheque.
A travelling repair person knocks on your door and states that while driving by, he/she noticed that the brickwork on your home is deteriorating, your house needs painting or the porch needs repairs, etc. This person "just happens" to have leftover material from another job and claims they can do your repair work at a considerable savings. Be extremely cautious of the "just passing by" home repair man. The leftover material offered may be stolen, defective, or not exist. Resist the impulse to grab this "bargain". When in doubt, check with a local building supply company or a reputable company that supplies a similar service or materials.
An individual claiming to be an inspector from your local utility company or from the local municipal government knocks on your door. He/she claims to be conducting a routine inspection and requests to take a look at your meter, furnace or fuse box. This "inspector" informs you that you are breaking a number of regulations and that if you do not have this fixed within 24 hours, your gas or electricity will be cut off. The "inspector" then informs you that he/she happens to have a friend who can do the job on short notice at a reasonable price. In actual fact, there is nothing wrong with your utilities.
Check the credentials of any public official or inspector. Call the utility company directly to verify the credentials of the "inspector" and their purpose of their visit. Always use the telephone number in the phone book, not a number provided to you by the "inspector" as the number may be phoney as well.
In an attempt to have you sign a contract, a salesperson may tell you such things as "it is just a formality" or "there is nothing to be concerned about" or "it's for your protection". however, there may be clauses in the contract that go beyond what you have been verbally led to believe. A legitimate salesperson will not attempt to rush you into signing anything and will not be unwilling for you to take your time to look over a contract before you sign it. Remember - once signed, the contract becomes binding and you are obliged to meet its terms. Even if the contract is questionable, it may require extensive legal services to break it. Never sign a contract that you have not read and fully understand. If you have any doubts whatsoever, seek advice from your lawyer, banker or someone you trust who has expertise and knowledge in contracts.
This is one of the most common fraud schemes over the last few years and sadly, many seniors have fallen victim to it and lost substantial amounts of money in the past.
Over the past number of years police have investigated many complaints received from local citizens regarding telephone and mail solicitations. The method of operation for a lot of these frauds is that the victim/complainant receives a telephone call from a subject identifying themselves as part of a company or gaming house. They indicate to the victim that they have won a large prize, usually cash or high dollar value items such as cars, boats, trips, etc.. They then advise the victim that they are to forward a money order, usually to cover "taxes" "shipping" or "legal fees" to a specific post office box number or location, addressed to a particular person. The amount varies from anywhere into the thousands of dollars.
The con artists explains to the victim that the company cannot release the prize to them before these taxes, etc. are paid, and may state that the law requires them to pay it before collecting their prizes. If the victim becomes suspicious, they will be given a phone number of an office or another person to contact. At times this has even been described as the number for a lawyer or a legal firm the victim may call to verify the authenticity of the scheme. Generally after the victim sends the money and after a period of time realizes they have not received their prize, they call the number back and it has been disconnected. Police are then contacted, but by then it is often too late.
When police attempt to trace these people or organizations, they do not exist. Identification and company names are fictitious, addresses are generally in vacant buildings and the phone numbers are all disconnected. Police generally are unsuccessful in finding out who is responsible for these schemes. The only advice police services are continually reminding the public of is "if it sounds too good to be true, it generally is. Nobody gets something for nothing."
Read the advertisement carefully. "For $19.95 you can purchase this 9x12 rug. Order early, supplies are limited." You forward your money order or certified cheque. Wait! Is this rug 9 x 12 inches? Or 9 x 12 feet as you would assume? Think carefully about advertising.
Retirement Estates/Out of Town Property:
Be suspicious of advertisements found in papers, magazines or brochures promoting real estate sales of retirement lots, villas, condominiums, etcetera in other countries, sight unseen. Remember the old joke about buying swampland in Florida? If these deals are fraudulent, they cannot be prosecuted as they are outside of Canada.
Travel Club Offers:
"Join our club and win a free vacation to a foreign paradise". The impression created by the solicitor is that a valuable prize has been won. Instead, the cost of this "free" vacation is often paid through inflated credit card charges. The actual vacation seldom fits the representation given and frequently contains additional hidden costs which must be paid during this vacation.
Work at Home Schemes:
A newspaper/magazine/e-mail ad states that you can earn extra money at home by sewing or doing some other task. It states that a sample of your work plus a small "registration fee" are required. Unfortunately, your work may not be returned and you may never hear from the alleged promoter again. Do not enter into any business transaction you have not thoroughly examined. It would be wise to consult the Better Business Bureau/Chamber of Commerce to verify authenticity.
An ad, usually found in magazines, offers a miracle cure for cancer, arthritis or some other disease. The ad states that for a specified amount, they will send you a special bracelet or some other device that will cure your ailment. You are asked to send a certified cheque or money order to some mail order clinic. Four to six weeks later, you receive the so-called miracle cure, which doesn't work. Unfortunately, there is no such thing as a miracle cure. If you suffer from a medical ailment, seek the advice of your doctor. Phoney medical treatment purchased through the mail should be reported to your physician, who will be glad to explain the pros and cons of any treatment.
Telephone solicitation is a recognized, legitimate business practice for the sale of goods and services, canvassing for charitable donations or conducting surveys. However, as a marketing technique, telephone solicitation can be susceptible to misuse. Telephone solicitation is not something to fear, but is a technique a consumer should understand and be cautious of. As you are the consumer receiving the call, remember YOU are in control - if you do not wish to buy, politely say so and hang up the phone.
COMMON EXPRESSIONS USED BY CON ARTISTS:
Too good to pass up....
Something for nothing....
Just between you and me.....
Double your money.....
These are some of the schemes that con artists use on a regular basis. Hopefully some of the following tips will help you avoid becoming a victim. In order to be successful, you must remain alert, suspicious and be aware of all the "catch phrase" warning signs that come from a con artist at work. If you believe you are being solicited by a con artist in any way, personally, by phone, mail or e-mail, contact the police immediately.
- Watch out for products that are promoted with prizes of free trips
- Be suspicious of "no risk" claims or promises of huge financial gain
- Beware of individuals or firms that operate outside of Canada.
- Resist pressure to act immediately. Act on reason, not impulse
- Before investing your money, get a second opinion from a financial advisor or attorney
- Find out what percentage of money a charity actually receives before making a donation to a charitable organization you have never heard of
- NEVER give your credit card, phone card number, social insurance number, bank account number over the phone.
- NEVER give your PIN number to anyone, or have it written down. Memorize it!
- NEVER give personal information over the phone
- Be careful when someone offers to deliver a product to your home. By telling them when it is convenient, you may also be providing them with the times when your house will be vacant.
- Middle aged women are particularly vulnerable to fraud if they have little knowledge or understanding of their financial position. If a woman's husband dies, it poses even more problems if she is uninformed about family finances
- Elderly people should list all their assets such as bank accounts, investments, mortgages, property, jewellery, art items, antiques and home contents and regularly check the items in their possession against their inventory list. A copy of the list should be left with next of kin or lawyer.
- Have your pensions and other incomes deposited directly into your bank account rather than have them mailed. This way no one but you has access to your money.