ACL Survey Finds Government Agencies Underperform on Fraud Detection & Reporting

Source: PRNewswire

Less than one third in public sector say the majority of fraud is ever detected

Government agencies performed significantly worse than the business sector on fraud detection and mitigation, according to a new survey. Less than one third of government respondents said the majority of fraud is detected and less than half said fraud that is detected ever gets reported, compared to 42 percent and 60 percent of respondents from the commercial sector, respectively.

The 2017 Fraud Survey from ACL, a risk management software provider helping governments and companies around the world stamp out fraud, polled more than 500 audit, compliance and risk management professionals on anti-fraud practices.

“Fraud in government agencies is estimated to cost taxpayers more than $136 billion each year1, and that’s just from improper payments,” commented Dan Zitting, chief product officer at ACL. “While both the public and private sector need to enhance their anti-fraud practices, the relative underperformance by government agencies should be a major concern of elected officials and their constituents.”

The survey also found that less than 30 percent of anti-fraud recommendations are fully acted upon by government agencies, compared to about 40 percent in the business sector. Both government and business respondents said the primary reasons for the failure to take action is lack of time/resources or approvals. However, this leading reason fraud is allowed to go unchecked was reported by less than a quarter of respondents (21 percent) in corporate firms, compared to nearly 40 percent of public sector professionals.

“Having worked with a number of government agencies to help them stop fraud, we were surprised by the differences in fraud management found between government and business,” said Scott Robinson, director, public sector, ACL. “It is clear that the public sector remains highly susceptible to fraud, and that many agencies are neglecting to take the necessary action to fulfill the public’s trust.”

1,700 names and phone numbers also stolen in data breach

Read more

2 men charged, 3rd sought in $10M fraud ring bust

By News Staff | City News

Toronto police have arrested two men, and are looking for a third, after they allegedly broke up a massive GTA fraud ring.

Police allege the trio used identity theft and fraud to fund a lavish lifestyle that included $10,000 crocodile shoes and $150,000 watches.

But the flashy clothing was just the tip of the iceberg: they allegedly stole $10 million from Canadians, Canadian institutions, and people living abroad.

The investigation began last summer. In the probe, police allegedly seized “37 fraudulently-obtained credit cards, hundreds of pieces of presumably stolen mail, and a series of notebooks containing the handwritten identity information of approximately 5,000 GTA residents.”

The details in the mail and in those notebooks was the starting point for the investigation, dubbed Project Royal. The Royal Canadian Mounted Police, the Competition Bureau of Canada, the Ontario Ministry of Government and Consumer Services, the Ontario Ministry of Finance, the U.S. Federal Trade Commission, and the U.S. Postal Inspection Service were all involved.

Adedayo Ogundana, 45, also known as Oladipupo Ogund, of Toronto, was arrested on Dec. 13, 2016. He’s charged with two counts of fraud over $5,000; 10 counts of fraud under $5,000; possession of property obtained by crime over $5,000; and possession of proceeds of crime.

He will appear in court on Thursday.

Adekunle Johnson Omitiran, 37, of Toronto, surrendered to police on April 27. He is charged with fraud over $5,000; four counts of fraud under $5,000; two counts of identity theft; trafficking identity information; possession of credit card obtained by crime; possession of proceeds of crime; possession of proceeds of crime; and fail to comply with probation.

He will appear in court on Friday.

Police believe the Omitiran had ties to people with “legitimate” access to identity information. Those people, police allege, sold information to Omitiran. Police are trying to track down those people.

A warrant has been issued for Duro Akintola, 44, also known as Michie Noah, of Toronto.

Emmanuel Salako, 47, of Toronto, also known as Gee Salaq, has been indicted by the United States Postal Inspection Service in Chicago under the name George Salako. He is wanted in the U.S.

Nova Scotia investment scam mastermind ordered to pay victims $1.1 million

By Aly Thomson


HALIFAX _ The Nova Scotia financial manager behind an investment scam “paid a hard price for his greed,” a judge said as she ordered him to pay back about 200 investors he bilked out of $1.1 million.

Quintin Sponagle of Upper Vaughan, N.S., pleaded guilty to fraud in December.

The charge involved 201 people who invested more than $4 million through Jabez Financial Services Inc. a Windsor, N.S., company registered in Panama. Sponagle has admitted he was responsible for $1.1 million that was not invested.

He used that money to buy cars, recreational vehicles and property and for international travel, cash withdrawals and other personal expenses, Judge Anne Derrick said in a new decision.

Derrick said he used other people’s hard-earned money to “feather his own nest,” and ordered Sponagle to pay the victims $1.1 million in restitution.

“Mr. Sponagle betrayed his investors and whatever moral code he may have had, primarily so he could live the good life and enjoy material benefits that otherwise would presumably have been beyond his means,” said Derrick.

“The fact that no restitution has been made by Mr. Sponagle in the over 10 years since his fraud was … means that these many victims have had their trust betrayed and have suffered harm, in some cases irreparable harm, to their future plans, to the security they were counting on for their retirements, and to their health, well-being and happiness.”

Derrick also accepted a joint recommendation from Crown and defence lawyers to sentence Sponagle to a year’s probation and time-served in jail.

Sponagle spent 19 months in Panama’s La Joya Penitentiary described by the judge in this case as “one of the world’s worst prisons.”

“He has paid a hard price for his greed,” she said of his time imprisoned in Panama.

Sponagle was brought back to Nova Scotia in November 2014 and released on bail a month later after posting a $45,000 surety.

The judge said victim impact statements revealed Sponagle’s actions affected the investors emotionally, mentally and physically, and shook their trust in others.

Many victims were from Sponagle’s “immediate social group,” she said.

“I have no doubt that Mr. Sponagle was seen by his hapless investors as an upstanding fellow citizen who provided no reason for anyone to mistrust him,” the judge said. “Mr. Sponagle used the trust he had been accorded by vulnerable and naive victims for his personal benefit.”

In October 2011, the Nova Scotia Securities Commission found Sponagle and Trevor Hill engaged in unfair practices, solicited investments without being registered in Panama or Canada, and failed to file a prospectus before distributing securities.

The commission concluded that between April and September 2006, the pair traded securities after receiving $4.1 million from 137 residents of Nova Scotia and 52 residents of other provinces.

“Mr. Sponagle spent investors’ money on himself, and indulged friends, relatives and business associates including Mr. Hill and his family,” the commission said in a statement dated Oct. 20, 2011.

The commission said the pair’s actions amounted to a “deceptive and dishonest ruse, designed to extract money from trusting and unsuspecting Canadian investors. It was in the nature of a ‘Ponzi scheme.”

It said Sponagle was the “mastermind of this scam,” and it banned both men from becoming or acting as a director or officer of any publicly traded company, or acting as an investment fund manager or promoter.

They were also ordered to each pay a $500,000 fine the maximum penalty at the time.

Auditors recovered about $2 million from Sponagle’s accounts, but only a portion was returned to investors, once financial fees were covered.

Unlicensed Entity Selling False Proof of Auto Insurance

The Financial Services Commission of Ontario (FSCO) is warning consumers that an organization known as Switzerland Imperial Bank AG (“S I B AG Corporation”) is not licensed to do insurance business in Ontario.

Switzerland Imperial Bank AG appears to have issued a fraudulent liability slip (“pink card”) to a consumer as proof of auto insurance.

Switzerland Imperial Bank AG is not licensed with FSCO or the Registered Insurance Brokers of Ontario.

Switzerland Imperial Bank AG is using the email address, is soliciting insurance business through their website, , and appears to be directing Ontario consumers to their Ontario director, Enzo Jones, at phone number (905) 551-0346.

Also, on its website, the address of Switzerland Imperial Bank AG’s headquarters is listed as Bosch 73 Huenenberg, Switzerland, and its telephone is listed as + 41 41 819 16 50.

Consumers should exercise caution if they are contacted by anyone claiming to represent Switzerland Imperial Bank AG or using these coordinates. Consumers should not purchase insurance items through Switzerland Imperial Bank AG, but instead are encouraged to contact the Canadian Anti-Fraud Centre.

If consumers purchase items or insurance through individuals or companies that are not licensed in the province, they are not protected under the Insurance Act and the regulations that govern Ontario’s licensed insurance companies and agents.

FSCO’s website contains a list of all insurance companies and agents licensed to do business in Ontario. The website of the Registered Insurance Brokers of Ontario contains a list of all brokers licensed to do business in Ontario.

Additional Information:

What to Do If You Think You are a Victim of a Scam or Fraud

SOURCE Financial Services Commission of Ontario

Scam Alert: How To Avoid Utility Fraud

Scam Alert: How To Avoid Utility Fraud

You may get a call about a late phone, gas or electric bill. Should you pay right away?

Chances are good that this call is a scam. According to Hiya, a company that makes caller blocking software, bogus utility callers claim to be calling from ConEd, Duke Energy, Georgia Power and Consumers Energy. Scammers even claim to be calling from General Electric, which isn’t even a utility company.

Here’s how the scam works: The caller will threaten to cut off power or other services and offer an “energy assistance” or payment plan. Once they get your payment information, they use that information to fleece you.

“Scammers are constantly looking for new ways to defraud consumers and we’ve seen triple digit growth in utility company scams in the past year,” said Jan Volzke, VP Reputation Data at Hiya.

“While many consumers now know to be wary of calls claiming to be from the IRS or offering a free cruise that seems too good to be true, the latest threat comes disguised in the form of the utility companies that we trust to provide our basic services, like gas and electricity.”

What You Can Do

Like most scams, the more urgent the message, the more you should avoid it, although most calls start out “we’re calling about your utility bill…”

And like the IRS, utilities rarely call customers. In most cases, it’s hard to get through to a human being when calling the companies. Here are some safeguards from the Better Business Bureau:

Prepaid debit cards are a red flag: If a caller specifically asks you to pay by prepaid debit card or wire transfer, this is a huge warning sign. Your utility company will accept a check or credit card and will usually direct you to one of their payment locations.

Don’t cave to pressure: If you feel pressured for immediate payment or personal information, hang up the phone and call the customer service number on your utility bill. This will ensure you are speaking to a real representative.

Don’t let people into your home: Remember that electrical meters are the property of the utility company and would be the responsibility of the utility to replace or repair.

Never allow anyone into your home to check electrical wiring, natural gas pipes or appliances unless you have scheduled an appointment or reported a problem.

Also, don’t get lured outside to view broken meters or point out property lines. Always ask utility employees for proper identification.

John F. Wasik is the author of  “Lightning Strikes,” “The Debt-Free Degree,” “Keynes’s Way to Wealth“and 13 other books on innovation, money and life. Follow him on Twitter and Facebook.  

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from ILSTV

You have Successfully Subscribed!

Pin It on Pinterest