Canada: CRA scam continues, but with a new twist

In October, 2016, the Royal Canadian Mounted Police (RCMP) announced a significant decrease in the amount of losses attributed to the CRA scam, following a large number of arrests conducted by Indian Authorities at a number of “call centres” in India. In the months following those arrests, the RCMP has continued to see that the number of reports related to the CRA scam remain at a fraction of what was reported prior to these arrests. Though the reports have diminished, it is clear that this scam has not ended. Furthermore, it would appear that the fraudsters are in the process of diversifying their approach. These perpetrators are attempting to re-engage victims who have previously lost money to the CRA scam. These fraudsters now appear to be testing the waters with a promise, sent via email, to pay back most of the funds that were lost, so long as the victim agrees to make an administrative payment (approximately 5% of the funds that were originally lost). The following is an actual quote from an email sent to a victim:

“We are happy to help you with our services. As you have already paid a huge amount of money to various scammers.  Based on your background verification and as per your discussion with our senior management personnel Mr. David Carter, we are pleased to pay you CAD 97000 dollars. This is to inform you that the above amount will be given to you in four equal installments on the payment of nominal documentation fees which is 4.9% of CAD 97000$ which is equal to CAD 4753 dollar. This is a one time payment of the documentation charges which shall be collected at your door step by our representative. On receiving the said fees, we shall release your first installment cheque worth CAD 24250 dollars within 48 hours. If you have any queries you can reach us via email or you can call our management personnel whose details are as under. Mr David Carter“.

Members of the RCMP Greater Toronto Area Financial Crime Unit would like to remind the public to remain vigilant of this type of scam which has been perpetrated by imposters claiming to be from the CRA, the Immigration Refugees and Citizenship Canada (Formerly known as Citizenship and Immigration Canada), as well as a number of police agencies across Canada. These fraudsters have impersonated government officials and/or the police by telephone or by email. Fraudsters are either phishing for your identification or asking that outstanding taxes, and/or fees to be paid through the following means: money service business (Western Union or MoneyGram), electronic funds transfer (direct deposits), pre-paid credit cards, iTunes gift cards, and other prepaid gift cards.

This scam has been a very profitable for these offshore fraudsters. Based on statistics from the Canadian Anti-Fraud Centre (CAFC) over 2,000 victims have disbursed more than $6.2 million to fraudsters posing as government officials since January 2014. Over that same time period, the CAFC have received reports of roughly 40,000 calls made to Canadian residences demanding they send cash to resolve outstanding tax and/or Immigration related matters. Most disheartening of all, based on the CAFC analysis, the reported numbers may only represent about 5% of the actual losses.

Many victims never report these incidents to the police. If you or a family member has fallen victim to this fraud, please report to your local police service, as well as the Canadian Anti-Fraud Centre. You have two ways to make a report to the CAFC; either by phone at 1-888-495-8501 (9:00 a.m. – 5:00 p.m. Eastern Time) or through their online reporting tool at http://www.antifraudcentre-centreantifraude.ca/reportincident-signalerincident/index-eng.htm

Please do your part in sharing this message with your friends and family and help us to create more awareness of this type of fraud.

2 men facing charges after taking turns driving the same car, police say

Ontario Provincial Police say two men who took turns driving the same car are both facing charges.

They say an alleged aggressive driver was pulled over around noon on January 5, 2016 on Highway 7, west of Norwood, Ont.

Police say 47-year-old Donald St-John, of Ottawa, was charged with driving under suspension, careless driving, not having insurance, and failing to produce a vehicle permit, and say the car was towed from the scene.

OPP say that shortly after 1:30 p.m., the same car was pulled over about 15 kilometres from the original incident after allegedly being clocked at 132 km/h, but this time the passenger from the first traffic stop was the driver.

They say 52-year-old Timothy O’Brien, of Couquitlan, B.C., was charged with two stunt driving counts and driving without a licence, and St-John was charged with permitting a vehicle to be driven with no insurance.

Both men are to appear in court in Peterborough, Ont., on March 17.

 

Manitoba Public Insurance lists top five fraud cases of this year

From staged car accidents to bogus car theft claims, Manitoba Public Insurance had to deal with a lot of fraud cases in 2016.

MPI’s special investigation unit takes a look at all suspicious claims, and this year they looked at 2,100 such cases, coming up with a top-five list:

* In one case, a person claimed to be hit by a car and unable to work, but security footage showed the claimant hadn’t been hit at all.

* A Porsche owner claimed that his car was stolen from his apartment block but RCMP found the badly damaged vehicle in a rural area the day before, resulting in the   claim being denied

* A man who was seriously hurt in the United States tried to file a claim with MPI, but it turned out he hadn’t lived in Manitoba for several years, making him ineligible.

* A father and son were asked to give a statement to an investigator about a stolen truck, but the son offered to pay nearly $11,000 in damage costs because, it turned out, he had taken the truck and rear-ended another vehicle.

* Finally, two cars collided and were badly damaged, but it turned out the drivers knew each other and had staged the crash to cash in on the already badly damaged vehicles. One of them pleaded guilty to fraud while there is a warrant out for the arrest of the second driver.

 

Attempted Fraud Claims

Filing five injury claims from a staged crash, falsely reporting the theft of tires from a truck, and an improperly insured, unsafe limo that went up in flames. These are some of the recent fraudulent and exaggerated claims handled by ICBC’s Special Investigation Unit (SIU).
“Auto insurance fraud and embellished claims take many forms,” said Chris Fairbridge, ICBC manager of the SIU. “When the facts just don’t seem to add up, we investigate.”
ICBC has completed more than 5,000 claims and driver licensing investigations so far in 2016.
Most claims are honest, but insurance industry studies estimate that fraudulent and exaggerated claims make up about 10 to 20 per cent of all claims costs. Applying those estimates means that fraud and exaggeration costs B.C. hundreds of millions of dollars each year or every ICBC policyholder more than $100 per year.
ICBC’s commitment to improving its detection and enforcement on fraud is expected to reduce its basic insurance claims costs by $21 million for policies written over the next year.
Here’s a sample of recent cases from ICBC’s claims fraud files.

A crash fit for the stage
Five people presented injury claims to ICBC after a two-vehicle crash in Surrey. The conflicting statements from the claimants, and the fact that the collision happened in the early morning hours, prompted the adjuster to call in the SIU.
Engineering evidence and verification by two witnesses showed one of the vehicles was driving at a very low speed just before the crash. Local residents stated they heard a vehicle accelerate from a stop and then heard a crash. Cell phone records revealed the occupants in both vehicles were talking to each other minutes before the collision. This evidence refuted the statements made by the drivers about the collision.
The investigation led to fraud charges and a B.C. Supreme Court case. One claimant received a $3,000 fine and was ordered to pay more than $4,000 in restitution. Another person involved in the staged collision received a $5,000 fine, a $1,500 victim fine surcharge and a two-year probation order.

A picture is worth a thousand words
The owner of a flat deck truck claimed four tires and a battery were stolen from the truck. At the time of the reported incident, an ICBC policy was in effect. But for the previous 17 months, the truck was not insured. The policy was purchased on January 18. The owner said he noticed the tires missing on January 21 and last saw his vehicle okay on January 17. SIU investigators canvassed the area for any witnesses or surveillance video in the industrial area where the truck was parked. Investigators found a witness who had taken a picture of the truck and sent it to the City of Vancouver, complaining the vehicle was abandoned and an eye sore for neighbouring businesses. The witness had taken the photo with a cell phone camera, which means there is metadata (the date and time information) embedded in the photo. The metadata indicates the photo was taken, with the tires missing, three-and-half hours before the insurance policy was purchased. ICBC denied the false theft claim.

Up in flames
On New Year’s Eve 2015, a driver who said his white stretch limo was for his own private use was on his way to a friend’s place when smoke suddenly started to come up from under the dash. The vehicle then erupted into flames. Several bystanders took video of the incident and shared the images on YouTube. The driver made a fire claim to ICBC. A mechanical inspection showed the vehicle was in poor condition. ICBC paid the claim.
But upon further online searching, the SIU’s Cyber Unit discovered the limo wasn’t for personal use. It wasn’t properly insured as a vehicle for hire and didn’t have a National Safety Code certification. Therefore, the owner was in breach of his insurance when he made the claim. ICBC is recovering the claims costs.

British Columbians are helping ICBC launch suspected claims fraud investigations. Earlier this year, ICBC conducted a media and public awareness campaign to draw attention to fraud claims. The campaign contributed to more calls to ICBC’s toll-free fraud tips line at 1-800-661-6844. ICBC saw a 70 per cent increase in the number of tips received during the first quarter of 2016 compared to the same time last year.
“The vast majority of claims we receive are legitimate and honestly reported and we always want honest customers to receive a fair settlement,” added Fairbridge. “But, there are some people who want to take advantage of the system by embellishing the facts or overstating their injuries. These are the types of claims that impact everyone’s insurance rates.”
ICBC will continue its commitment to stepping up its fight against fraud, including the implementation of a new fraud analytics tool which will help identify and target fraudulent claims throughout the claim process.  Early experience and testing with this tool have already helped to identify a number of potentially suspicious claims which are currently under investigation.
British Columbians can further protect their wallets by reporting suspicious activities related to insurance fraud to ICBC’s toll-free tips line at 1-800-661-6844. Tip information is confidential and callers can remain anonymous. For more information, visit icbc.com/fraud.

39 Month Delay Nets Stay of Proceedings in B.C. Man’s Theft and Fraud Case

A B.C. Supreme Court judge has granted a stay of proceedings in a theft and fraud case that he says would have taken more than three years to conclude after charges were laid.

Justice Robert Johnston says the defence is responsible for six months of the delay, but he also blamed the Crown for what he called an unreasonably long wait for a trial date.

The case involves investment adviser Charles Dass, who was accused of defrauding three sets of complainants, including a family that invested $300,000 with him, between January 2000 to December 2007.

The first complaint against Dass was made to the RCMP in Port Alberni in March 2007 but he was not charged until June 2013.

A written ruling released Monday says Dass’s trial was set to conclude in early September 2016, almost 39 months after a myriad of delays.

Johnston suggested a “culture of complacency” was involved in derailing the preliminary trial by nine months though he says it should have been a straightforward process.

 

Wells Fargo will pay $190 million to settle customer fraud case

Reuters

Wells Fargo will pay $185 million in penalties and $5 million to customers that regulators say were pushed into fee-generating accounts that they never requested, officials said on Thursday.

“Wells Fargo reached these agreements consistent with our commitment to customers and in the interest of putting this matter behind us,” the bank said of its settlement with California prosecutors and federal regulators.

“We regret and take responsibility for any instances where customers may have received a product that they did not request,” it added.

The Consumer Financial Protection Bureau will receive $100 million of the total penalties — the largest fine ever levied by the agency, which was conceived after the 2008 financial crisis.

“Today’s action should serve notice to the entire industry that financial incentive programs, if not monitored carefully, carry serious risks that can have serious legal consequences,” said CFPB Director Richard Cordray.

Los Angeles officials and the Office of the Comptroller of the Currency were also party to the settlement.

In a complaint filed in May 2015, California prosecutors alleged that Wells Fargo pushed customers into costly financial products that they did not need or even request.

According to that complaint, Wells Fargo employees pushed checking account customers into savings, credit and online accounts that could generate fees.

Bank employees were told that the average customer tapped six financial tools but that they should push households to use eight products, according to the complaint.

The bank opened more than 2 million deposit and credit card accounts that may not have been authorized, according to the CFPB.

The bank said that the deal this week settles the “allegations that some of its retail customers received products and services that they did not request.”

In recent financial filings, Wells Fargo has changed how it describes and calculates “cross-sell” — a term for bundling multiple products to retail, wealth management and corporate customers.

The bank added new language to its last annual report, stating that its “approach to cross-sell is needs-based as some customers will benefit from more products, and some may need fewer.”

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