How to Avoid Financial Fraud: It’s All in Your Phone

fraud

March is Fraud Prevention Month in Canada.

As technology evolves, so do the techniques thieves use to trick us out of our money. Cybercrime and fraud has been a frequent topic of discussion as companies like Equifax have recently been victims of hacking. Risks to mobile phones, especially smartphones, are increasingly becoming common as well.

And despite our basic knowledge on prevention (e.g. don’t share your PINs or passwords with others, etc.), three-quarters of Canadian millennials say they feel at risk of becoming a victim of  cybercrime.

According to a new survey from TD, nearly one-quarter (23 per cent) of Canadian millennials are not using the screen-lock password feature on their device. The survey also found that two-thirds (67 per cent) of millennials use the same password across multiple log-ins, or a slightly different version of a password, such as adding a number to a letter-based password. At the same time, one in five millennials (19 per cent) keep a list of passwords stored on their device.

Every year, thousands of Canadians fall victim to fraud, losing millions of dollars collectively. You work hard for your money – that’s why you so diligently hover your hand over the keypad to hide your PIN as you punch it in at the ATM. But if you don’t apply that same diligence to your mobile devices, now is the time to start taking some extra precautions:

Use a passcode and change it regularly

Even if you don’t share your phone passcode, it’s always a good idea to switch this number up at least once per year. Think about all the information you have stored on your phone. If left unlocked, fraudsters can easily access things like your banking information or accounts with other companies. Enable auto-lock so your device locks after being left idle for a short period of time. If you lose your device and it is unprotected, notify your financial institution immediately and change your banking passwords.

Check your statements frequently

Most people check their monthly statements, but it’s better to check your accounts every few days or so to ensure no funny business is going on. This has become extremely easy since almost all banks have rolled out a mobile app. Sometimes thieves will make small charges to your account to see if you’re paying attention before going for a big score later. If you notice anything suspicious, report it right away.

Your identity matters

We worry often about our money being stolen, but having our identities compromised should be the bigger concern. If a thief gets a hold of your social insurance number and home address, they can open credit cards under your name. Rarely do you need to give out your SIN, so keep your card in a safe place at home, not in your wallet. Even better, try to remember your number by heart so you can recall it if you ever need it.

Check your credit report every year

In Canada, there are two credit reporting bureaus – Equifax and Transunion. You should check both every year to make sure there’s no suspicious activity (for example, your credit score decreasing even though you paid your debts in full and on time). Not every company reports to both bureaus so checking both credit bureau reports will ensure you cover all of your bases.

Phishing has changed over time

Most people by now know they shouldn’t trust an email from an overseas prince offering unlimited riches, but phishing scams have evolved. Some scammers now call people directly claiming they owe money to the CRA or another official organization. If you ever receive a questionable call, ask for their contact info and hang up. With that info, go online and check the organization’s website for their official contact info. You can then call them to find out if you indeed owe them money.

Email and mobile scams

Generally speaking, it’s never wise to give away any personal information such as your passwords, credit card information, or SIN number online (including on your cell phone) unless you’re sure the recipient is legitimate. Remember, many phishing scams are meant to appear like the real thing so pay close attention to the links sent to you through email or text. For example, you may receive an email from “Paypal” that asks you to pay for a recent purchase. If you’re unsure, call customer service to verify if they indeed contacted you. 

Door-to-door con artists

Door-to-door scams have been quite popular for years. In a nutshell, a person comes to your door, posing as your hydro provider and asks to see your furnace or bills. They then try to sell you on repairs, upgrades, or even new contracts when in reality, they are from another company attempting to sell you things you don’t need and ultimately steal your money.

Your hydro provider will never perform an unannounced inspection. If you’re approached, ask for their name, photo ID, and business they represent. You should then ask them to leave. You can always call your hydro company later to verify if that person was an actual employee.

If it sounds too good to be true, it probably is

If you ever come across an investment opportunity that’s promising a high return with no risks, it’s probably a scam. For example, an “investor” may reach out offering you 25 per cent in returns if you invest with them. They’ll likely make the first few payments, but push you to invest more; that’s when they may run with your money. Remember, there’s no such thing as easy money, so be cautious if someone ever promises you a way to make money quickly.

Stay updated with recent scams

The CRA website has great resources for learning how to recognize financial fraud, but it’s also worth doing your own additional research. Many local police departments put out press releases when they see an increase in fraud. Or you can simply Google “new financial scams.”

Following these tips can lessen the chance of it occurring, but sometimes you may still become a victim of fraud. It can happen to anyone and if it does happen, don’t panic. Contact your financial institutions and credit card providers and they’ll be able to walk you through the steps to get you back on track.

This post has ben updated.

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