We had a chance to talk with Paula Naka, Manager of Risk Management at Interior Savings, about fraud, common scams and how smart people get caught by crooked schemes. Corporate Security and Fraud Detection and Prevention is one area of responsibility for the Risk Management team, and our conversation with Paula showed how passionate she is about helping our members protect themselves from fraudsters.

Q: Paula, what Frauds and Scams do you hear about most often?

A: Unfortunately, the number one scam changes from day to day. Scam organizers are very smart, and work hard to stay one step ahead all the time. So the biggest issue we face is that these crooks, whether they work alone or in organized groups, are continually coming up with new ways to target people.

Many of the scams that we’re seeing today are just a new take on old schemes, but they’re leveraging a multitude of ways to contact individuals. In addition to traditional door-to-door, mail and telephone, fraudsters are using automated technology to email and text, so it makes it really difficult for people to know when something’s a scam.

We do find some scams are cyclical. For example, during tax season we see a higher volume of Canada Revenue Agency (CRA) scams. The CRA scam involves fraudsters phoning individuals claiming they owe money for taxes, and threatening the victim with jail or deportation if they don’t send funds, give up their credit card number, or send iTunes cards or gift cards to cover the tax debt.

Q: Isn’t that a red flag – the Canada Revenue Agency asking for payment in iTunes cards?

A: These scams target those most vulnerable – in this case, new Canadians. If you’re new to the country, you don’t know how the tax system works, or what “typical” payments look like. And, if a crook finds someone who has been in dispute with CRA about what they owe, then that person may feel it’s plausible that the CRA would call to demand payment. The scammers sense when they’re dealing with someone vulnerable, and then they start the threats. They say if you don’t pay ‘x’ number of dollars, or give us your credit card number right now, or purchase iTunes cards and send them to us, then we’ll put you in jail. They threaten your family, they threaten deportation, they make all sorts of terrible threats.

Q: What tactic do fraudsters use most?

A: Fraudsters rely on being able to pull on your heartstrings or fears. One scam, which we call the Emergency scam, is where the crook calls, an individual answers, and the crook just says “Grandma?” If they happen to get someone on the phone who is a grandmother, ‘Grandma’s’ mind goes to whatever child is most likely to be in trouble, or that family member with whom they have a special relationship, and ‘Grandma’ offers “is that you, Mary?”  Now the crook has a name to use: “Yes Grandma, it’s Mary. I’m in trouble, I need help.”

The more skilled the fraudster, and the more scared the victim is, the more easily the fraudster will draw out information.

We know that fraudsters make the most headway by pulling emotional strings – like fear or excitement. People love prizes so there are a lot of scams out there that offer a prize, then demand you pay something up front – a deposit fee, prize fee, service fee, hold your spot fee or request duty or exchange if the prize is outside of Canada. And there are trivia games that come in on your mobile phone; people don’t realize they’re paying a fee for every text that goes out.

These are just a couple of examples. There are many scams that feed off emotions, such as romance, charities, and medical scams.

Q: But what are the chances that I have a granddaughter that could realistically be in trouble, or that I’ll believe the caller is CRA, or that I won some sweepstakes prize out of the blue?

A: Well, that’s the thing – all the stars have to align. With any type of fraud, it’s about the stars aligning. Maybe I’m in disagreement right now with CRA about my taxes. Or maybe I prepared my own taxes and I wondered about some of my answers. The telephone scams are robocalls calling hundreds of thousands of people, looking for one bite. It’s the same with emails – they’re sending batches and batches hoping to hook one person who is already nervous, or excited to win, or in a desperate enough situation that they’ll jump through some hoops for the chance to get at money they really need or that prize they wish they could win right now.

Q: So what can I do to protect myself?

A: There are two very good websites that offer updates on what’s currently happening: RCMP Scams and Fraud page and the Canadian Anti-Fraud Centre. And really, trust your instincts: if you receive a text, an email or a phone call from someone you don’t know, hang up, delete it, take the time to look into it. If it’s a call from someone in your family, hang up, use a different phone and call the person back, or check with another family member to confirm they’re really where they say they are and are actually in trouble. If you get an email or a text saying you just won $100 or a TV – did you enter a draw for a TV?  Because if you didn’t enter anything, you’re not a winner.

Most people have an inkling when something’s not right. The thing is, it’s a statistically proven fact that once you’ve been a victim of fraud, you’re actually more likely to be defrauded again.  Your name goes on a list and other fraudsters come after you. For example, there’s a new twist on the CRA scam: fraudsters are going back to people who have already fallen victim to the CRA scam. They’ve sent in money, then learned it’s a scam. Now they get a call or an email that says ‘we recognize you’ve been the victim of a scam and here’s an opportunity for you to get some of your money back – you just need to pay a finder’s fee’!

My advice is: Educate yourself and try not to react instantly to anything. Anything you receive that doesn’t seem quite right – don’t act on it. Take a step back, do some investigation, and then determine whether or not it’s legitimate. Call a friend or someone you trust and ask for their advice.

If you’re not sure, call your financial institution – we all work hard to keep our staff apprised of what’s going on. Chances are, our staff has heard about the scam, and can confirm your instincts. You can reach our Member Service Centre at 1-855-220-2580 or visit your local Interior Savings branch.

Do we have your current contact information?

Things change – including phone numbers and addresses. One additional way you can help to prevent fraud is by ensuring we have your current contact information on file. The next time you’re in your local branch, please confirm that the phone numbers and address we have on file are correct. You can also update your contact information in online banking or by calling our Member Service Team at 1-855-220-2580.