‘It’s a very unusual level of cheating,’ says Insurance Council of B.C.

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B.C. government expects changes in 2018 to help collect fraud penalties, pursue criminal convictions


B.C. Finance Minister Carole James said Tuesday her government expects to take steps in the new year to improve fine collections and increase emphasis on court convictions of fraudsters.

Under consideration is whether more investigators are needed at the B.C. Securities Commission, for example, or more resources are needed to pursue criminal convictions, said James, who spoke to The Vancouver Sun’s editorial board.

“That’s a conversation the Attorney General (David Eby) and I have been having. If a case is recommended (for prosecution) it needs to be a priority. And that is a challenge in the judicial system, where, there are lots of issues and priorities coming forward.”

James has already asked the securities commission to provide proposals on how it will improve collection of fines from fraudsters.

Those are being reviewed now, she said.

Other ideas being examined include expanding information sharing with the Canada Revenue Agency, said James. “We are not closing the door on anything,” she said.

Some changes may need legislation, which could affect the timing of implementation, noted James.

The B.C. government’s actions follow a Postmedia investigation reported last month that found criminal convictions have been rare and less than two per cent of $510 million in fines issued to fraudsters by the securities commission had been collected in the past decade.

Among significant fraud cases where police have decided not to pursue an investigation are separate Ponzi schemes carried out by West Vancouver-resident Virginia Tan and Surrey resident Tom Williams.

In a 2016 securities commission judicial panel decision, Williams was banned from B.C.’s capital markets and fined $21.8 million for carrying out an $11.7-million Ponzi scheme involving 123 people. The RCMP told victims the case was not a big enough fraud and it did not have the resources for an investigation.

In an April 2017 settlement agreement with the B.C. Securities Commission, Tan was banned from B.C.’s capital markets and fined $3 million after admitting to carrying out a $30 million Ponzi scheme since 2011.

The Vancouver Police Department said it believed the case was better handled by the securities commission.

Neither Williams nor Tan have paid their fines.

Following the Postmedia investigation, one of the Tan Ponzi scheme victims, Peter Doetsch, who lost more than $4 million, said he contacted the North Vancouver RCMP to interest them in launching an investigation.

In a speech earlier this month to an anti-corruption conference in Vancouver, Eby, the attorney general, citing the Postmedia investigation, said there is no question B.C. has preferred to pursue fraud cases through securities commission investigations and penalties over police investigations and criminal charges.

There is some sense in that, said Eby, including that securities commission tribunals offer a faster process with more relaxed rules of evidence.

The downsides are obvious: penalties at securities commission tribunals are less serious than criminal convictions, said Eby.

“For a senior who has been cheated out of his or her retirement savings, a tribunal penalty seems like a shallow consequence, or a cost of doing business, for what makes a much bigger difference to their life than a petty theft that might result in a criminal record for the perpetrator,” he said.

Eby said he didn’t want to discount the difficulty of collecting penalties.

However, he said, with fewer than two per cent of penalties collected, and limited criminal charges going ahead, the message is obvious to those who might wish to participate in white-collar crime — you’ll have a better chance to get away with it in B.C.

This is not acceptable, Eby said, which is why he wants to increase the likelihood of fraud cases being treated with the prosecutions they deserve.

Source: Vancouver Sun

Anti money laundering centre crunches data in fight against fentanyl

By Jim Bronskill


OTTAWA _ Canada’s anti-money laundering agency is helping fight the scourge of fentanyl by tracing the illicit movement of funds tied to the deadly drug.

Barry MacKillop, interim director of the federal Financial Transactions and Reports Analysis Centre, says the agency has passed intelligence about the dangerous opioid to law-enforcement partners.

Just this week, the financial data-crunching agency, known as Fintrac, was cited for its role in uncovering a Calgary-based trafficking network, leading to the seizure of more than $4 million worth of drugs, including fentanyl.

The agency tries to pinpoint cash linked to money laundering and terrorism by sifting through tens of millions of pieces of information annually from banks, insurance companies, securities dealers, money service businesses, real estate brokers, casinos and others.

Fintrac’s annual report, tabled in Parliament on Thursday, says the agency made 2,015 disclosures of intelligence in 2016-17 to partners including Canada’s spy agency, the RCMP and other police services up from 1,655 the year before.

Of the latest disclosures, 1,366 were related to money laundering, 462 involved terrorism and threats to national security, and 187 involved all of these.

Fintrac has been working for months with police and the many institutions that supply reports about suspicious dealings to come up with common signs of fentanyl trafficking, MacKillop said in an interview.

“It is a challenge to identify the indicators that are specific to fentanyl versus heroin or cocaine or any other type of drug.”

However, source countries for various drugs differ, so geographical analysis of transactions can be helpful, he added.

Authorities have identified China as a leading source of opioids entering Canada.

Fintrac’s analysis played a role in the investigation of Kevin Omar Mohamed, a former Ontario resident who pleaded guilty to a terrorism charge for travelling to Syria with the aim of joining an extremist group.

Amid the flagging fortunes of the so-called Islamic State of Iraq and the Levant, Canadian security agencies are focusing on the possible return of dozens of young Canadians who headed overseas to fight alongside militants.

Fintrac is looking to see what type of intelligence it can generate on returnees, MacKillop said. “If we see dormant accounts, for example, that all of a sudden become reactivated, that may be an indicator.”

Last year, financial institutions committed to focusing on the tracking of money laundering associated with human trafficking in the sex trade.

The agency received about 2,000 suspicious transaction reports from businesses across Canada during the 2016 calendar year relating to these efforts an increase of 400 per cent from the previous year, the annual report says. “The reports came from all the major banks and a number of money services businesses.”

Indicators of human trafficking for sexual exploitation include purchases of short-term stays at hotels, back-page ads for escort services, and after-hours credit card payments at strip clubs, massage parlours and modelling agencies.

Another priority for Fintrac is working with institutions to develop a stream of tips that could help uncover illicit fund movements tied to mass-marketing fraud _ both the garden-variety spam campaigns that dupe the most vulnerable and more sophisticated schemes involving market manipulation and insider trading, MacKillop said.

Fintrac has made a number of disclosures to enforcement agencies related to tax evasion, though the information is not necessarily related to the leaked files known as the Panama Papers and the Paradise Papers, he said.

The Canada Revenue Agency has the federal lead on examining the papers and will determine whether Fintrac can be of assistance, MacKillop added.

Uber hack latest example of why vigilance required to keep your wallet safe

By Craig Wong


OTTAWA _ When Doug Hoyes had his credit card information stolen, fraudsters used it to pay for three taxi rides in Toronto.

He wasn’t in that city, but discovered the charges while routinely checking his card transactions online and notified his bank, which cancelled the card.

Hoyes, a licensed insolvency trustee, says the incident illustrates the importance for individuals to keep a watchful eye on their statements in a world where financial information can be stolen in a myriad of ways.

“I realize that the bank will probably cover you anyways, so you’re not going to lose any money, but do you really want to wait until they’ve used up your credit limit and you’re trying to put gas in your car and you can’t because you’re over your limit?”

Earlier this week, ride-hailing company Uber came clean about a year-old hack that compromised the data of 57 million Uber riders. The information stolen included names, email addresses and mobile phone numbers. The number of Canadians affected was not immediately known.

News of the security breach comes just two months after Equifax Inc. said some 145 million consumers _including roughly 8,000 Canadians _ had personal data, and in some cases credit card details, stolen by hackers in a massive data breach earlier this year.

The thefts were the latest in what has become a regular occurrence of hackers breaking into systems and stealing customer information.

While individual pieces of information like the email addresses and mobile phone numbers that were taken in the Uber theft may seem innocuous on their own, when thieves combine it with other information that may be available elsewhere, it can spell trouble.

But even if you weren’t affected by the Uber or Equifax data breaches _or any others so far _ you need to be vigilant because hacks are going to happen, he added.

“If you weren’t impacted by this one, you probably will be impacted by the next one.”

If your information is hacked, you need to change your passwords and your PINs to something that is not easily guessed, advises Lynne Santerre, a spokeswoman for the Financial Consumer Agency of Canada.

Santerre added that if you’ve been compromised you should also contact the major credit bureaus and ask for a fraud alert to be placed on your file.

“That tells lenders to contact you before approving any application for credit in your name,” she said.

“So if anyone is trying to take out credit in your name, you’ll get a phone call and you’ll be able to confirm whether that application was yours.”

Hoyes noted that much of the job of securing your information online isn’t up to you, but rather the companies storing it. But, he added, there are still things you can do such as reviewing credit card transactions and cancelling any credit you don’t need.

Both Hoyes and Santerre recommend regularly checking your credit report with the two major agencies in Canada _ Equifax and TransUnion.

Checking your credit report can tip you off if your information was stolen because you will see if there are any accounts you don’t know about that may have been opened fraudulently.

Hoyes also advised against giving out your social insurance number unless required because the more information that is out there, the more at risk you become.

If your card issuer offers you an alert service that sends you a message when your card is used, it can be a great way to keep an eye on charges. But, Hoyes added, it’s not enough to rely on the fraud protection systems at your bank.

“You’ve got to be in charge,” he said. “You’ve got to take responsibility here and be looking at these things on a regular basis.”

Young adults ‘putting themselves at fraud risk’ by sharing details online

Young adults ‘putting themselves at fraud risk’ by sharing details online

Irish Examinar

Young adults’ willingness to share personal information with others online could be putting them at greater risk of fraud, a report warns.

While older people are often seen as less tech-savvy, potentially putting them at greater risk of fraud, UK bank NatWest found that less cautious behaviour among those aged 18 to 24 years old in particular could be making them vulnerable.

NatWest, which commissioned think tank Policy Network to look into financial fraud trends, found more than 80% of young adults in this age group are willing to share their email address online with their friends, and as many as 29% are willing to share their mother’s maiden name – a commonly used security question.

This contrasts with just 60% of over-55s willing to share their email address, and only 12% willing to share their mother’s maiden name.

The report was launched at a fraud summit being held by NatWest.

David Lowe, NatWest’s head of fraud prevention, said traditionally the view has been that older people are most at risk of financial fraud.

He said: “Whilst fraud is still prevalent in this age category, we are seeing an increasing trend in younger ’digital natives’ falling victim to online fraud.”

Matthew Laza, director at Policy Network, said: “We need to ensure that today’s school children don’t become another ’generation scammed’.

“As more and more of life moves online this is a real danger for the future.”

Research for this report involved a review of available data on fraud and scams, analysis of YouGov survey data, and interviews with fraud experts.

Source: www.irishexaminer.com


RECO freezes bank accounts of Toronto area brokerage, substantial sum missing

By Aleksandra Sagan


VANCOUVER _ The bank accounts of a Toronto brokerage are frozen to protect consumer deposits after Ontario’s real estate professional regulatory body discovered “a substantial amount” missing.

The Real Estate Council of Ontario issued a freeze order for the first time in about six years on Nov. 1 against RE/MAX Right Choice Inc.

“This is very rare,” said RECO spokesman Daniel Roukema, who could not elaborate further on the sum of money in question.

The Toronto brokerage, located at Centerpoint Mall in the north part of the city, did not immediately respond to requests for comment and its website appeared to be down. A person with the mall’s answering service told The Canadian Press the office appeared to be closed, despite its hours indicating it should be open until 9 p.m. ET.

RECO discovered the discrepancy between how much money the brokerage should have held in trust in its accounts and the amount it possessed last week during a routine check, Roukema said.

People making an offer to buy a home in Ontario must provide proof of a deposit typically about five per cent of the sale price _ to the seller either when the offer is made or shortly thereafter. The brokerage of the realtor representing the buyer will hold the deposit in the brokerage’s real estate trust account until it must be paid to the seller on the closing date.

RECO froze the brokerage’s accounts to protect consumers from further harm, Roukema said.

It’s urging homebuyers and sellers who are involved with the agency or their lawyers to contact the council, he said.

“If anyone has deposited money, then they do have options to file a claim,” he noted. The Canada Deposit Insurance Corporation protects eligible deposits at its member financial institutions up to $100,000.

RECO’s investigation is ongoing and the council has not been in contact with police, Roukema said.

RE/MAX Integra, a sub-franchisor that represents about a third of the worldwide RE/MAX network, terminated Right Choice as one of its franchises Monday, Oct. 23 _ prior to RECO beginning its investigation, said Galen Wright, a consultant with Toronto-based FleishmanHillard’s reputation management practice, in an email.

“We recognize that buying a home is one of the most important decisions a person can make,” he said. “We pride ourselves on the values of honesty, fairness and accountability, and we support RECO in their efforts to protect consumers.”

RE/MAX Integra is unable to provide further details on why it terminated the brokerage’s contract, he said.

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