According to the Canadian Anti-Fraud Centre, a total of 67,000 Canadians were victims of fraud in 2021 and collectively lost around $380 million. This number is an underestimate because these numbers are only reported values but many victims of fraud are too ashamed to actually report it to police. The Government of Canada has put together a library of information on different scams, what to do if you have been a victim, and has a place where you can report any scams and fraud. The website can be found here (https://www.antifraudcentre-centreantifraude.ca/index-eng.htm). Making sure that you stay up-to-date on common methods that cybercriminals use can help make sure that your information and finances stay safe.

Social media is a combined trillion dollar business. We have dating companies like Bumble and Match. We have sharing platforms like Pinterest and Tumblr. We have social selling platforms like Spotify and Etsy. We have a number of gaming companies that are too numerous to count, which are pumping out new apps daily. Finally we have the mega-leaders like Snapchat, Meta/Instagram, ByteDance (TikTok), Twitter, Reddit. There is a massive amount of your personal information on the web in different forms and there are lots of ways that criminals can use social media to gain access to your information. The Federal Trade Commission (FTC), an independent government agency in the USA, is focused on antitrust law and the promotion of consumer protection. They have advised that social media scams account for a quarter of all reported losses and people aged 18 to 39 are actually twice as likely as older adults to lose money from a social media scam. I believe that this is due to the younger generation growing up with online purchasing taking precedence over in-person shopping. This has given the younger generation a heightened level of trust when they are buying goods and services online without thinking about who is on the other side of the transaction. The ease of developing a fake persona on social media and the ability to use the different advertising tools to target specific audiences allows social media to hold the top spot for all fraud

Investment-related scams were the most prevalent type of fraud on social media, accounting for a third of all reported scams. If the promises seem too good to be true then they usually are. Have you ever taken a minute to think that if someone had “the golden idea” to investing in anything then why would they provide that idea to the masses, whatever the price they charge. If an investment idea is so profitable then whomever created it should have endless profits. Additionally, be very wary about different platforms that you use to invest. We have seen numerous ponzi schemes related to different cryptocurrency exchanges. The only reason that I bring these up is that cryptocurrency exchanges are so new that there are hundreds to choose from and regulators are still scrambling to get the necessary laws in place to keep these websites in check. If an exchange is fraudulent then investors usually end up getting pennies back on their dollar, if anything, when authorities shut down these fraudulent websites. Be careful, be cautious, and don’t get sucked into the latest trend simply due to the fear of missing out.

Romance scams were a close second when it comes to fraud on social media. I’m not going to talk much about this one. Our emotions can trick us to make decisions that we would not normally make. I’d avoid sending any money online to anyone that asks, no matter how good or bad their story is as to why. Just don’t do it or get advice from someone that you trust before you send the money. It can help if someone can think about what you are about to do logically rather than emotionally.

Online shopping scams held the spot for the third most reports of fraud on social media. Have you ever bought something online that just never came? Not all of these lost packages are fraudulent but companies are getting more and more sophisticated to gain your confidence by creating fake tracking numbers and even responding to email requests regarding the location of your package. Make sure that you are buying products from reputable sellers as there is no protection from the social media company if your product doesn’t arrive. The FTC has stated that 90% of the reports associated with undelivered goods on social media platform purchases are associated with Facebook and Instagram. One way to help combat this type of fraud is to make sure all your online purchases go through a credit card. Most credit cards have existing insurance that covers the cardholder if the goods or services are not delivered as advertised.

The last type of fraud that I am going to discuss today is through the use of a clickable link or scannable QR code. Clicking an unknown link or scanning a foreign QR code is not to be taken lightly as cybercriminals can embed different technology to steal data, gain access to a device, or to redirect payment somewhere else. This is becoming so prevalent that the Federal Bureau of Investigation put out a Public Service Announcement on January 18 so that people are aware. The link to the PSA can be found here (https://www.ic3.gov/Media/Y2022/PSA220118). Don’t just click first and ask questions later, be vigilant.

It seems that cybercriminals are waiting around every corner but I’d argue that our online presence is higher than it has ever been before. We exist more in the virtual world today than we ever have in the past and I do not see this trend slowing down anytime soon. I’m not saying to avoid all online transactions but I am saying that careful thought is required before doing anything online. If you’re worried, ask your advisor. Over the course of our careers, we have seen many kinds of fraud so our experience has taught us to see through some of the different techniques that cybercriminals try to use.

Want to chat more? Reach out to me at info@financerx.ca