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Phone bank fraud is rising in Canada. How to protect yourself from being scammed

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Do you frequently get suspicious texts and calls about your bank account being compromised or notifications about unauthorized charges on your credit card? You’re not alone.

Bank fraud is on the rise in Canada and scammers are now using new ways over the phone to spoof Canadians.

This year, as of Sept. 30, there have been 2,769 reports of phone calls from fraudsters claiming to be from a financial institution, according to the Canadian Anti-Fraud Centre (CAFC). That number is up from 2,212 reports in 2021 and 1,147 the year before, according to data shared with Global News this week.

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The number of bank-related phishing text messages reported to the CAFC has also increased in 2022, with 543 reports affecting 219 Canadians, compared with 394 reports last year and 347 in 2020. But that number could be much higher because the agency estimates that less than five per cent of phishing scams are actually reported to the CAFC.

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Text spamming is becoming common as the scammers are getting smarter and more efficient, said Daniel Tsai, a lecturer in law, business and technology at the University of Toronto.

“It basically looks like a legitimate text coming from your bank when in fact it’s a spoof (but) it looks authentic,” he said. “So a lot of people who are not sophisticated may not recognize that it’s a scam.”

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What does a scam look like?

Sometimes, it can be hard to differentiate between a scam and legitimate bank correspondence, but there are a number of red flags.

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Criminals may use caller ID spoofing to display the number of a financial institution. These calls are often an automated voice message, but sometimes they might also attempt to have a conversation with you.

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Banks will never ask you to confirm your account number, PIN, password, social insurance number or any other personal information via text, phone call or email. They will only request information to verify your identity when you call them.

Spear phishing scams involve the culprit pretending to be a legitimate source, asking for money to be sent to them.

Financial institutions will never request a transfer of money to an external account for security reasons, the CAFC warns.

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In Canada, new variations of the “bank investigator” scam have also popped up, according to the CAFC.

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In one such variation, the fraudsters prompt you to dial *72 followed by a phone number so that all incoming calls to the victim’s phone are forwarded to them.

Fraudsters also pose as CAFC employees to try to get your personal and/or financial information.

A scammer may also call to ask for a cash withdrawal to help catch a bank employee who has been allegedly stealing money.

What do scammers want?

There are a number of things fraudsters are after when they try to scam you, money being one of them.

According to the CAFC, the “bank investigator” scam through direct phone calls has resulted in a loss of $3.27 million this year.

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Tsai said a “big driver” for scammers is access to private information and passwords so they can crack into your bank accounts and steal your money.

There is also a risk of identity theft where fraudsters can use your personal information to access bank accounts, open new bank accounts, transfer bank balances, or apply for loans and credit cards, the CAFC warned in a recent bulletin published for Cyber Security Awareness Month in October.

Identity thieves can also buy goods, hide their criminal activities, get passports or receive government benefits.

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Protecting yourself from fraud

With bank fraud on the rise, there are a number of ways to protect yourself.

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Refrain from sharing your personal information over the phone and giving away money, especially if you have been contacted on an unsolicited basis, says Tsai.

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“Find out from them who you’re speaking to, what the contact number is — and then check out the number and call them back,” he advised.

“And that’s a way to cross-check and ensure that you’re not being scammed.”

To avoid becoming a victim of phishing attacks, avoid clicking on suspicious links or downloading attachments sent via text. The CAFC also advises to watch for spelling mistakes.

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To protect yourself from getting spoof calls, the Canadian Radio-television and Telecommunications Commission recommends Canadians register their telephone numbers on the National Do Not Call List.

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Most recently, some Canadian networks, like Bell, have also started using artificial intelligence to detect and block scam calls.

Over the past two years, Bell’s new system protected Canadians from more than one billion such calls, said Éliane Légaré, a spokesperson for the telecom provider.

If you suspect you have become a victim of fraud, contact your local police, report the incident to the Canadian Anti-Fraud Centre and also let your bank know.

If you’re a victim of identity fraud, place flags on all of your accounts, change your passwords and report the fraud to both credit bureaus (Equifax and TransUnion), the CAFC says.

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