March 22, 2019 | Jason Van Gaal
Top 5 Scams to Protect Yourself Against in 2019
Phone scams are a million-dollar business. Over $95 million CAD in 2017, in fact. From January 2014 to December 2016, it is estimated that Canadians were scammed out of $290 million. Tack on another massive loss of over $95 million in 2017 and 2018 respectively.
A Better Business Bureau report found that even tech-savvy millennials fall for phone scams at an alarming rate. If we are aware that this is happening, why can’t we stop it? Below is a play-by-play of exactly how scammers are conning people out of their money. By understanding the patterns of these criminals, we can start to be aware of what to look out for when we get those mystery phone calls.
We look at the leading phone scams of 2018, explain how they work, and advise on how to avoid them in 2019. This year, when the scammers come for you and your hard-earned money, you will know what to do.
#1. The “CRA Is Going to Arrest You” scam.
This particular phone scam starts out with a call or voicemail message that goes something like this:
“The CRA is filing a lawsuit against you due to tax evasion and the CRA has strong evidence that you have failed to file your actual income tax which was higher than it was supposed to be. To get more information about this case file, call our number [insert scammer phone number]. I repeat [spoofed phone number]. If we don’t hear from you, we will issue an arrest warrant under your name and have the police bring you in.”
Notice the urgency and authoritative tone. These are signs of a classic phone scam. The hope is that the possibility of trouble with the law will blind your common sense. And it works more than we realize. This scam makes an appearance every year around tax time as people start to sweat about what they owe the government and are more likely to settle quickly on the phone.
The key to breaking through this scam is to know that the CRA doesn’t call to demand immediate action or payment. They’ll mail you a bill first or send you a notification to check your “My Account” online. And they’re not bringing law enforcement into the mix right from the start. All you must do is ignore these calls and inform everyone you know that these calls are a joke. That’s the best way to fight scammers—awareness.
#2. The “We Need to Verify Your information” scam.
This is where the scammer poses as an official from some institution. They usually claim to be from your insurance. The call starts off quite professional and polite. All the caller wants to do is verify some information for their records. If you object, they get defensive and say they don’t want you to give them any information. They just need you to verify what they already have on record. Sounds ok, right?
But it’s not. In 2019, it is highly unlikely that an insurance company would use a phone call and a live agent to call and check on your information. It doesn’t make sense from an economic angle. Generally, these companies will verify information through an email. Much more cost effective and less invasive.
- Always be suspicious of any stranger calling up and asking for your personal information, even its just to “verify” it. These scammers are quite smart and coy. They will “verify” the information by rambling off a postal code in your city, any postal code, expecting you to respond with the correct one.
- Be prepared for them to bully you if you don’t comply. If they sense any kind of uncertainty on your part, they’ll apply the pressure. You could lose your insurance. They are issuing an arrest warrant. Of course, if the call gets to this point, you can be certain that it is a scam.
- They may lead with questions like, “Do you suffer from chronic back pain?” or “Have you smoked in the last 30 days?” This seems innocent enough, but it’s just to get you warmed up. Without you even noticing, the questions begin to get a little more personal, verifying sensitive information like your birth date or Social Insurance Number. What is surprising is, in most cases, they already have the information on hand. You assume they received it legitimately and there’s no harm in verifying it. But of course, you’d be very wrong.
You see, scammers are building an identity profile on you. Once they have enough information, they can use your identity to commit fraud. They build this profile piece by piece, and they can’t be sure about the information they have on you until you verify it for them. So anything you say, even answering the phone, helps them build their profile. They know the number they have for you works, that you’ll answer it, and that makes it valuable for them to sell. Maybe you slip up and say something like “Now is not a good time, I’m taking my kids to school”, and just like that, you have given them more information than they had before, fleshing out more of your identity profile.
The way to stop this phone scam is to never give out your personal information over the phone. Never verify it either. If you’re concerned that the caller has a legitimate need for it, then tell him or her that you’ll call the company directly and verify the information at that time. Never hand out that information to someone who called you out of the blue.
The caller may offer to transfer you to another agent of give you a “direct” phone number to skip over the ever dreadful hold music, but don’t trust this either. They will simply direct you to another scammer. Call your local insurance branch directly or get their 800 number from a credible site.
#3. The “Your Computer Has a Virus” scam.
Your phone rings and it’s someone claiming to be from Microsoft or Apple. They’re calling because your computer has a virus.
Initially, you may think how wonderful it is that these companies are so proactive and protective of their users. The scammer will ask you to go to your computer and open a log. They will ask you to read out the top three running programs and immediately tell you that one of them sounds suspicious. At this point of the grand scam, the caller will send you to a website where you will be asked to give the caller permission to access your computer. If you give them this access, it is essentially game over. Once they are in, they will install malware. To add insult to injury, they will often try to get you to pay them for their “service”.
#4. The “We’ll Shut Off Your Utilities” scam.
This is when scammers call posing as a utility company. They’ll state you fell behind on your monthly payments. They will demand an immediate payment right then. If you refuse, they’ll shut off your power, gas, water, etc.
Similar to some other scams, they rely on bullying tactics to get your anxiety revving. In reality, you will receive notification on your next bill that you’ve missed a payment and if it ever gets to the point that the utilities are at risk of being shut off, there will be many, MANY letters and registered letters prior to someone coming to your house to discuss options. As outlined above, tell the caller that you will call back in an hour and make sure to research the number yourself.
#5. The “Can You Hear Me?” scam.
According to a Better Business Bureau report, this was the scam of 2018, with over 10,000 reported instances. For this phone scam, someone calls and simply asks, “Can you hear me?” The goal is to record you saying, “Yes,” so they can use your voice to authorize purchases.
The best way to handle this kind of call is to vet what you are saying carefully. How will the conversation sound out of context? Have you made it sound like you are agreeing to anything? Of course, the very best solution to this scam is to simply hang up. Another tactic is to always respond to queries with a question. Like: “Who is this?” or “What’s this about?”
While reading all of these can be intimidating, there are a few things you can do today to help you in your quest to avoid these scams all together. You can register your number on the National Do Not Call List or be proactive by downloading an app that filters your calls for you. That way, you don’t even risk the chance of getting a scam call.