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Scams - FAQ

1. What are scams and how do they work?
   
   
2. How can I recognize a scam?
   
   
3. What are some examples of common scams?
   
   
4. How can I protect myself from scams?
   
   
5. Where can I obtain more information?
   

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1.  What are scams and how do they work?

Scams are fraudulent schemes that are used by criminals to target travellers or that originate in foreign countries to take advantage of Canadians at home. Canadian citizens — many of them experienced in overseas transactions — have lost millions of dollars to scams. Scams range from attempts to engage business people in fictitious money transfers to fraudulent solicitations to supply goods in fulfilment of nonexistent contracts.

Scams are designed to exploit the trust you develop in your foreign partner and defraud you of goods, services, or money. Unsolicited letters and e-mails received in Canada often originate in another country. However, you may be asked to visit a foreign country to finalize the deal.

Scams are usually flexible and may be adapted to take the greatest advantage of their targets. They can be very sophisticated and may take victims to staged meetings, often held in borrowed offices at government ministries or at overseas locations. The persons involved do their research and can often provide plausible, but fake, orders written on seemingly genuine government stationery, replete with official stamps and seals.

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2.  How can I recognize a scam?

Scams are not always easy to recognize, and scammers are constantly weaving new elements into their schemes. While the following list is far from complete, some indications of a likely scam include:

• any deal that seems too good to be true;
• fraudulent purchases (i.e., time shares, jewellery and gems);
• any offer of a substantial percentage of a large sum of money to be transferred into your account in return for your "discretion" or "confidentiality";
• requests for signed and stamped blank letterhead or invoices, or for bank account information;
• requests for an urgent air shipment, accompanied by an instrument of payment whose genuineness cannot immediately be established;
• solicitation letters or e-mails claiming that the soliciting party has personal ties to senior government officials;
• requests for advance payment in U.S. dollars for transfer taxes or incorporation fees;
• statements that your name was provided to the soliciting party either by someone you do not know or by a "reliable contact";
• promises of advance payment for services to be provided to the government;
• claims that a visa is not necessary or that your arrival in the country should be overland from a neighbouring country;
• resistance to your checking in with a Canadian government office abroad;
• unsolicited job offers;
• offers of volunteer employment;
• statements that you have won a lottery you did not enter;
• announcements that you have inherited a large sum of money from a deceased relative;
• websites or classified ads offering purebred puppies for sale at bargain prices;
• offers to supply oil; and
• any offer of a charitable donation.

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3.  What are some examples of common scams?

Examples include:

• Money Transfer: The operator claims to have a large sum of money, usually millions of dollars, that needs to be transferred to a "safe" bank account abroad. You, as the account holder, are promised a percentage of the huge sum, just for allowing the use of your account. You may be asked to provide blank, signed invoices, letterhead, and bank account information, or to send money for transfer taxes. Many individuals and businesses have found their accounts looted by the persons to whom they sent account information.
• Fraudulent Order: The operator usually places a small order, paying with a genuine cashier's cheque drawn on a foreign bank. The operator then places another, somewhat larger order, again paying with a genuine instrument. Then you receive an order by courier. Your partner urgently needs a large quantity of your product air-shipped. Confident in your partner, you ship, but this time the cashier's cheque (which looks the same) is a forgery. Experienced business people usually require full payment in advance of shipment or an irrevocable letter of credit confirmed by a reputable international bank.
• Charitable Donation: The scammer offers to make a donation to your organization, asking for bank account information, and then loots the account or asks for advance payment of a fee to ensure conversion into dollars.
• Contract: The scam artist claims to have a government contract and needs your company's expertise to carry out the job, and then scams you by collecting thousands of dollars in "fees" before you can do business.
• Crude Oil: The scammer claims to have an allocation of crude oil to sell, sometimes claiming to be working on behalf of an official corporation. Then come demands for various fees to supply you with the crude; of course, you never get your cargo. Businesses lacking experience with the petroleum industry should approach with great caution any proposal involving crude oil sales.
• Business Opportunity: The scammer convinces you to explore a business opportunity by visiting his or her country. Once you arrive, the scammer takes charge of your life, trying to keep you from contacting friends, family, or a Canadian government office. By various means, sometimes including violence or threats of violence, the scammer extorts money from you. This type of scam becomes particularly dangerous for a victim who has entered a country without a valid visa. You must have a visa prior to arrival in a country that requests visas from Canadians, and you must pass through immigration formalities upon entry into the country. Consult the Visas FAQ for more information.
• Detained or Hospitalized Family Member or Friend: Scam artists have called parents and friends of travelling Canadians (often in the middle of the night) to report that their loved one has been detained or hospitalized, and have requested that money be wired immediately via Western Union. Parents or friends should call our Emergency Operations Centre for assistance if approached in this way
• Internet-Based Romances: Going abroad to meet a partner must be done with caution, especially if the relationship began on the Internet. See our Marriage Overseas FAQ for more information.

 

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4.   How can I protect myself from scams?

Caution should be exercised when contemplating any business transaction. The best rule is to carefully check any unsolicited business proposal originating from a foreign country before any funds are committed, before any goods or services are provided, or before any travel is undertaken.

Canadians intending to conduct business abroad should be aware of the high rate of commercial fraud in certain countries. Occasionally, persons who have gone to a foreign country to "finalize" deals have been threatened or assaulted. Local police and other officials do not always provide assistance to those caught up in scams.

Canadians are reminded never to accept, under any circumstances, requests to carry envelopes or small parcels into a foreign country.

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5.   Where can I obtain more information?

Consult our Travel Reports. Information on how to protect yourself and what to do if you fall victim to a scam is available from the Royal Canadian Mounted Police, PhoneBusters (the Canadian Anti-fraud Call Centre), and RECOL (Reporting Economic Crime Online).