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Fraudsters are Targeting Seniors - Learn to Protect Yourself

Written by Kelley Keehn

Monday, June 26th, 2017

June is Seniors' Month, and unfortunately, fraudsters prey on this demographic regularly. Elders are often home more, many still have landlines (and answer them) and because they're newer to the Internet, social media, emailing and text messaging, scammers target them specifically.

Romance Scam

One scam that can do incredible damage to the heart and bank account is what's called a Romance Scam. The CAFC (Canadian Anti-Fraud Centre) warns that "romance scams continue to cause severe financial harm on consumers, which has a profound impact."

In 2016, 689 victims lost over $14.3 million to scammers pretending to be in love. While seniors didn't account for all of the victims, they are more vulnerable to being duped because many are inexperienced with spotting Internet and social media fraud.

Nancy Cahill from the CAFC explains the scam works with "fraudsters stealing photos and using dating sites and social media to lure potential victims into sending money for various reasons. The fraudster will gain the trust of the victims through displays of affection and in some cases will send flowers, gifts and tokens to prove that their feeling is genuine."

This increases the trust level between the victim and the fraudster, which results in the potential victim usually losing more money with each new request. And the longer it goes on, the worse it gets.

How to Protect Yourself from Romance Scams

  • Be cautious if someone wants to develop a quick relationship with you
  • Never send money – ever!
  • If you receive a "paycheque" or another form of payment from someone you've met online and they ask you to cash it and send a portion of the funds to them – don't do it!

Tyler Fleming from the Ontario Securities Commission says romance scams aren't the only schemes seniors need to watch for.

"While anyone can be a victim of fraud, this Seniors' Month we encourage older investors to get to know some of the warning signs of investment fraud," he says.

4 Investment Fraud Warning Signs

  • Being told you can make a lot of money with little to no risk. Generally, the higher the potential return of an investment, the higher the risk of that investment. There is no guarantee you'll actually get a higher return by accepting more risk. If someone promises you an investment that has high returns with little or no risk, the investment they're offering might be a scam.

  • You get a "hot tip" or insider information. The sources of "hot tips" or insider trading don't have your best interests in mind. Think about why they're offering you tips and how they benefit by telling you about them. Keep in mind that acting on insider information about a public company is an illegal activity.

  • You feel pressured to buy. Scammers frequently use high-pressure sales tactics to get your money and then move on to other victims. Investing your money is a serious decision, and should always be done with time and consideration. Be very cautious if you're asked to make a decision right away, or are presented with a limited-time offer. Fraudsters don't want to give you enough time to figure out their scheme. Before you invest, take the time to research and ask questions.

  • The individual or firm offering you the investment is not registered to sell investments. Before you invest, check the registration and background of the person offering you the investment. In general, anyone selling securities or offering investment advice must be registered with the securities regulator in your province or territory. Visit CheckBeforeYouInvest.ca, call the OSC, or visit your provincial securities commission.

According to a survey conducted by the OSC in 2015, 35% of people who have been victims of investment fraud are defrauded more than once. So be sure to share this article with the elders in your life, and if you encounter suspicious activity, report it to the Canadian Anti-Fraud Centre.

For more information on how to protect yourself, visit:

GetSmarterAboutMoney.ca

antifraudcentre-centreantifraude.ca

FinancialPlanningForCanadians.ca

checkfirst.ca/

www.canada.ca/en/services/finance/fraud.html

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