How seniors can avoid falling victim to financial frAud
SPONSORED BY THE AUTORITÉ DES MARCHÉS FINANCIERS
We are all potential targets for opportunistic fraudsters. That said, for a number of reasons — perhaps health, fragility and isolation — seniors are often the victims of choice for perpetrators of fraud.
Here are three types of fraud most commonly aimed at the elderly.
AFFINITY FRAUD
When someone trusted raves about a successful investment, it can have a ripple effect within their community. Different social circles can lend themselves to that.
“Recreational associations, seniors’ residences and places of worship are examples of settings where fraudsters may come into contact with potential victims,” said Michel Gariépy, an analyst specializing in financial education at the Autorité des marchés financiers (AMF).
Once a connection with potential victims is made, a fraudster will begin offering access to the unique and exceptional investment opportunity they claim to have benefited from. The fraudster will often ask people not to discuss the opportunity with others, including financial experts, claiming that too many people knowing about it would spoil the golden opportunity.
“The fraudster wants the victim to keep quiet about the investment to avoid having to go through any verification by their relatives, financial experts or even the AMF,” explained Gariépy. “Be on your guard when someone brags about financial success and makes tempting offers that are apparently exclusive to a select few.”
PLAYING ON FAMILY TIES
Known as the “grandparent scam,” a fraudster will pose as a loved one in need to convince seniors to send them money. This classic strategy typically consists of a phone call or email by a person who claims to be a close relative, often a grandchild. They feign distress and ask the victim to quickly transfer money.
If you find yourself in this situation, don’t hesitate to ask a lot of questions that can confirm the person you’re speaking with is indeed a loved one.
“We must be cautious because with today’s social networks, a lot of personal information is shared and can become useful to potential fraudsters,” Gariépy recommended. “Before you transfer money, ask yourself if the situation feels right. Also take the time to contact other relatives to see if the story checks out, and try to reach the family member allegedly in distress using the contact information you know to be correct.”
You can help protect elderly relatives by suggesting that they never give in to such requests without confirming the identity of the person they’re speaking with.
PHISHING
Phishing often consists of sending e-mails or text messages that mimic those sent by companies, financial institutions and legitimate government agencies.
Whether it’s the announcement of a tax refund, a lottery win or a message that your bank account has been hacked, these messages have only one goal: to collect your confidential personal and financial information, such as your SIN, a credit or debit card number or a PIN. With this information, fraudsters can act quickly and extract large sums from their victims’ accounts and credit cards.
Be on the lookout for these messages and never respond to them. A government agency, financial institution or firm never obtains or updates your personal information in this manner.
HOW TO PROTECT YOURSELF FROM FINANCIAL FRAUD
Fraudsters are good at gaining their victims’ confidence. They’re persuasive because they present themselves well and seem to be as informed as a real professional. They know how to promote their false qualifications and achievements.
If someone who offers financial products approaches you, check if they and the company they claim to represent are registered with the AMF. This can be done by contacting an AMF agent at the Information Centre or by consulting the Register of firms and individuals authorized to practise. Registration with the AMF is not an absolute guarantee against fraud, but it at least confirms that the company or individual is authorized to practice.
For more information, visit lautorite.qc.ca.