Scams 

The Canada Revenue Agency warns Canadians of mail scam

The Canada Revenue Agency (CRA) is warning taxpayers to beware of a recent scam where some Canadians are receiving a letter fraudulently identified as coming from the CRA and asking for personal information. The letter is not from the CRA. A PDF version of the letter is available on the CRA Web site at www.cra.gc.ca/alert.

The letter claims that there is “insufficient information” for the individual’s tax return and that in order to receive any “claims,” they will have to update their records. The letter attaches a form specifically requesting the individual’s personal information in writing, via fax or email, including information on bank accounts and passports. This letter is not from the CRA and Canadians should not provide their personal information to the sender.

All taxpayers should be vigilant when divulging any confidential information to third parties. The CRA has well established practices to protect the confidentiality of taxpayers’ information. The CRA has notified the proper law enforcement authorities of this scam. For information about this and other similar scams, or to report deceptive telemarketing activity, visit www.phonebusters.com, send an email to [email protected], or call 1-888-495-8501.

Members Be Aware!

Several credit unions advised Risk Management at Central that their members have received unusual emails which purport to be sent on behalf of Carrington Mortgage Services. These emails tell the recipient that:

“A payment to Carrington Mortgage Services LLC in the amount of $8,845.63 has been made from your chequing account. For further information about this transaction, please download attached invoice file (Password for ZIP archive; “invoice”).

Research on the Internet reveals that the apparent purpose of these emails is to have the recipients open the attached zip file which contains some form of Malware or virus that will infect the recipient’s computer. Malware can do everything from hijack your computer using it to send spam to everyone in your own email program to more sinister applications like harvesting your passwords to your bank accounts and other private information. If any TECU members receive any suspicious emails, please forward them immediately to [email protected]. Remember that you should not give out any personal information, open any attachments or click on any links that are provided in suspicious emails.

419 Nigerian Scam

This scam usually begins with a letter-form email sent to many target recipients making an offer that will result in a large payoff for the intended victim. The stories behind the offers vary, but the standard plot is that a person or government entity is in possession of a large amount of money or gold. This person, for a myriad of reasons, either cannot access the wealth directly or is no longer in need of it. Such people, who are fictional or impersonated characters played by the scammer, could include the wife of a deposed African or Indonesian leader or dictator, a terminally ill wealthy person, a wealthy foreigner who had deposited money in the bank just before dying in a plane crash, leaving no will or known next of kin, a US soldier who has stumbled upon a hidden cache of gold, a business being audited by the government, a disgruntled worker or corrupt government official who has embezzled funds, a refugee, and similar characters. The money could be in the form of gold bullion, gold dust, money in a bank account, so-called "blood diamonds", a series of cheques or bank drafts, and so forth. The sums involved are usually in the millions of dollars, and the investor is promised a large share, often 40% or more, if they will assist the scam character in retrieving the money from holding and/or dispense of it according to the scam character's wishes. The proposed deal is often presented as a "harmless" white-collar crime, in order to dissuade participants from later contacting the authorities.

Many operations are professionally organized in Nigeria, with offices, working fax numbers, and often contacts at government offices. The victim who attempts to research the background of the offer will often find that all pieces fit perfectly together. Such scammers can often lure wealthy investors, investment groups, or other business entities into scams resulting in multi-million dollar losses. However, many scammers are part of less organized gangs or are operating independently; such scammers have reduced access to the above connections and thus have little success with wealthier investors or business entities attempting to research them, but are still convincing to individuals and small businesses, and can bilk hundreds of thousands of dollars from such victims.

The spam emails perpetrating these scams are often sent from Internet cafés equipped with satellite Internet. Recipient addresses and email content are copied and pasted into a web mail interface using a standalone storage medium, such as a memory card. Many areas of Lagos contain many shady cyber cafés that serve scammers; many cyber cafés seal their doors during after-hours, such as from 10:30 PM to 7:00 AM, so that scammers inside may work without fear of discovery. During the course of many schemes, scammers ask victims to supply bank account information. Usually this is a "test" devised by the scammer to gauge the victim's gullibility.

Scammers often request that payments be made using a wire transfer service like Western Union. The reason given by the scammer will usually relate to the speed at which the payment can be received and processed, allowing quick release of the supposed payoff. The real reason is that wire transfers and similar methods of payment are irreversible, untraceable and, because identification beyond knowledge of the details of the transaction is often not required, completely anonymous.

How does the fraud work? The bait is the fictional millions of dollars described in an unsolicited email or letter. The goal is to get you to come up with money for the "expenses" required to transfer those millions to you. The victim thinks a few hundred or a few thousand dollars is trivial when $31 million is at stake. Each demand for more money is claimed to be the very last obstacle before the big money is released. Sometimes, the victim is lured to Nigeria, where even worse things happen.

If you receive such an email, do not respond to it! Delete it from your inbox. Always remember, if it sounds too good to be true; it usually is.

Fake Cheques and Cheque Cashing Scams

Fraudulent cheques and money orders are key elements in many advance fee scams, such as auction/classified listing overpayment, lottery scams, inheritance scams, etc, and can be used in almost any scam when a "payment" to the victim is required to gain, regain or further solidify the victim’s trust and confidence in the validity of the scheme.

The use of cheques in a scam hinges on a common practice concerning cheques; when an account holder presents a cheque for deposit or to cash, the bank must (or in other countries, usually) make the funds available to the account holder within 1-5 business days, regardless of how long it actually takes for the cheque to clear and funds to be transferred from the issuing bank. The cheque clearing process normally takes 7-10 days and can in fact take up to a month when dealing with foreign banks. The time between the funds appearing as available to the account holder and the cheque clearing is known as the "float", during which time the bank could technically be said to have floated a loan to the account holder to be covered with the funds from the bank clearing the cheque.

The cheque given to the victim is typically counterfeit but drawn on a real account with real funds in it. With a piece of software like QuickBooks or pre-printed blank cheque stock, using the correct banking information, the scammer can easily print a cheque that is absolutely genuine-looking, passes all counterfeit tests, and may even clear the paying account if the account information is accurate and the funds are available; however, whether it clears or not, it will eventually become apparent either to the bank or the account holder that the cheque is a forgery. This can be as little as 3 days after the funds are available if the bank supposedly covering the cheque discovers the cheque information is invalid, or it could take months for a business or individual to notice the fraudulent draft on their account. It has been suggested that in some cases the cheque IS genuine - however the fraudster has a friend (or bribes an official) at the paying bank to CLAIM it is a fake weeks or even months later when the physical cheque arrives back at the paying bank.

Regardless of the amount of time involved, once the cashing bank is alerted that the cheque is fraudulent, the transaction is reversed and the money removed from the victim's account. In many cases, this puts victims in debt to their banks as the victim has usually sent a large portion of the cheque by some non-reversible 'wire transfer' means (typically Western Union) to the scammer. Some victims have even been prosecuted for fraud in the scammer's stead, the argument being that the victim "should have known better" than to participate in such a scheme, and thus was a willing conspirator in the fraud.

Some schemes are based solely on cheque cashing. The scammer will contact the victim to interest them in a "work-at-home" opportunity, or asking them to cash a cheque or money order that for some reason cannot be redeemed locally. A recently-used cover story is that the scammer wishes the mark to work as a "mystery shopper", evaluating the service provided by MoneyGram or Western Union locations within major retailers such as Wal-Mart. The scammer sends the victim a cheque or money order, the victim cashes it, sends the cash to the scammer and the scammer disappears. Schemes based solely on cheque cashing will usually offer only a small part of the cheque's total amount, with the assurance that many more cheques will follow; if the victim buys in to the scam and cashes all the cheques, the scammer can win big in a very short period of time. Other scams such as overpayment usually result in smaller payoffs for the scammer, but have a higher success rate as the scammer's request seems more believable.

Some cheque-cashing scammers involve multiple victims at multiple stages of the scam. A victim in the US or other "safe" country such as the U.K. or Canada (often the country in which the cashing victim resides) is sometimes approached with an offer to fill out cheques sent to them by the scammer and mail them to other victims who will cash the cheque and wire the money to the scammer. The cheque mailer is usually promised a cut of the money from the scammer; this usually never occurs, and in fact the cheque mailer is often conned into paying for the production and shipping costs of the cheques. The cheque information has either been stolen or fictionalized and the cheques forged. The victim mailing the cheque is usually far easier to track (and prosecute) than the scammer, so when the cheques turn up as fraudulent, the one mailing them usually ends up not only facing federal bank fraud and conspiracy charges, but liability for the full amount of the fraudulent cheques. Because the cheque mailer is taking the fall, the scammer is even less likely to be caught, which makes it a popular variation of the scam for scammers in nations with tougher anti-fraud laws and better enforcement than that of Nigeria.

If you would like more information about cheque fraud a great website to visit is www.fakechecks.org. This site is based in the US but there is plenty of useful information to keep you well informed.

Shipping/Receiving Scam (Pet Adoption)

This is a variant of a money scam but uses pet adoptions.  A person will respond to an advertisement for a pet. The buyer will then want to immediately make arrangements to receive/ship the pet (notice how they don't even ask to see pictures of the pet, or ask for health/vet questions about the pet). Buyer will ask seller to use their pet shipping service and even give a number. Buyer will also want to send a money order or cashiers cheque through Western Union (another variant of the Western Union cheque scam). Once the seller receives payment, cashes the cheque and/or money order, the seller then sends the money to the fake shipping service. Once money is received the buyer will claim they changed their mind and want their money back, or buyer will say he doesn't want the pet any longer. Within 5 days the cheque or money order comes back as bad and the seller is responsible for covering the bad cheque.

Rental Scams

Where the victim (e.g., a prospective tenant) is looking to rent accommodation, the scammer will post a classified advertisement offering a high-standard place for low cost, even showing pictures of the said rooms. The victim is required to pay a deposit, but once the scammer has received the deposit he will disappear leaving the victim out-of-pocket.

Where the victim (e.g., landlord) is looking to find a tenant for their accommodation, the scammer poses as an interested party who is looking to move to said location. On inquiry to the prospective tenant, the victim receives a follow up email indicating they will be sent a cheque by the tenant's new employer that will cover the rent, plus the new tenant's living expenses (e.g., to purchase furniture). The victim is asked to forward the additional portion to their new tenant by Western Union (or similar).

Another version is when the victim posts on a communal website (e.g. Craigslist) that he/she is looking for a roommate to share a rental unit (or is a landlord looking to rent a unit), and the scammer poses as an interested party and sends a cheque to hold the room. The cheque will originate from overseas. The victim receives the cheque and deposits it into his/her bank account, and that amount of money will temporarily appear as having been added in. Within a few days the scammer then contacts the victim and advises that he/she cannot move into the rental unit due to an illness. The scammer will even provide what appears to be medical documents’ indicating this state of ill health. The scammer then asks the victim to immediately wire transfer the money from the cheque back to him/her. This takes place, and then a few days later the victim finds out from their financial institution that the original cheque has bounced.

Home Equity Line of Credit & Loans Wire Fraud Scam.

High-dollar losses are being attributed to a scam that targets credit union members that have been granted large Home Equity Line of Credit loans. (HELOC or MERITline™) The perpetrator sends a fax or email to the financial institution requesting that they process a funds/wire transfer. The perpetrator contacts the local telephone company and impersonates the consumer by stating that the home phone lines are in disrepair. The fraudster then provides a cellular phone number and asks that call forwarding be activated immediately to avoid missed calls. Afterwards, all calls made to the consumer’s home telephone are simply re-directed to the criminal including the call made by the financial institution attempting to verify the wire transfer request. Wire transfer amounts are frequently in excess of $100,000 and are sent to accounts with the words “Title” or “Construction” in the account name. Perpetrators seem to have detailed information about the consumers that enable them to answer additional challenge questions. It appears that US based credit union members with a HELOC have been the primary targets of this scam but it is highly possible that other financial institutions have been experiencing similar fraud scenarios.  At TECU we will not forward your funds without confirmation from you, either with written instructions or in person.

Telephone Credit Card Scams.

This is an email floating around out there. Whether or not it is entirely true is beside the point. We here at TECU think it sends a great message. Protect your personal information!

This one is pretty slick since they provide YOU with all the information, except the one piece they want. Note, the callers do not ask for your card number; they already have it.

This information is worth reading. By understanding how the VISA & MasterCard telephone Credit Card Scam works, you'll be better prepared to protect yourself.
The scam works like this:

Person calling says, "This is (name), and I'm calling from the Security and Fraud Department at VISA. My Badge number is 12460, your card has been flagged for an unusual purchase pattern, and I'm calling to verify. This would be on your VISA card which was issued by (name of financial instituion). Did you purchase an Anti-Telemarketing Device for $497.99 from a marketing company based in Arizona?" When you say "No", the caller continues with, “Then we will be issuing a credit to your account. This is a company we have been watching and the charges range from $297 to $497, just under the $500 purchase pattern that flags most cards. Before your next statement, the credit will be sent to (gives you your address), is that correct?"

You say "yes".

The caller continues - "I will be starting a Fraud Investigation. If you have any questions, you should call the 1- 800 number listed on the back of your card and ask for Security. You will need to refer to this Control Number. The caller then gives you a 6 digit number. "Do you need me to read it again?" Here's the IMPORTANT part on how the scam works:

The caller then says, "I need to verify you are in possession of your card". He'll ask you to "turn your card over and look for some numbers". There are 7 numbers; the first 4 are part of your card number, the last 3 are the Security Numbers that verify you are the possessor of the card. These are the numbers you sometimes use to make Internet purchases to prove you have the card. The caller will ask you to read the last 3 numbers to them. After you tell the caller the 3 numbers, they'll say, "That is correct, I just needed to verify that the card has not been lost or stolen, and that you still have your card. Do you have any other questions?"

After you say no, the caller then thanks you and states, "Don't hesitate to call back if you do", and hangs up. You actually say very little, and they never ask for or tell you the card number. We called back within 20 minutes to ask a question. Are we glad we did! The REAL VISA Security Department told us it was a scam and in the last 15 minutes a new purchase of $497.99 was charged to our card. We made a real fraud report and closed the VISA account. VISA is reissuing us a new number. What the scammers want is the 3-digit PIN number on the back of the card. Don't give it to them. Instead, tell them you'll call VISA or MasterCard directly for verification of their conversation.

The real VISA told us that they will never ask for anything on the card as they already know the information since they issued the card! If you give the scammers your 3 Digit PIN Number, you think you're receiving a credit. However, by the time you get your statement you'll see charges for purchases you didn't make, and by then it's almost too late and/or more difficult to actually file a fraud report.

What makes this more remarkable is that on Thursday, I got a call from a "Jason Richardson of MasterCard" with a Word-for-word repeat of the VISA Scam. This time I didn't let him finish. I hung up! We filed a police report, as instructed by VISA. The police said they are taking several of these reports daily! They also urged us to tell everybody we know that this scam is happening. I dealt with a similar situation this morning, with the caller telling me that $3,097 had been charged to my account for plane tickets to Spain, and so on through the above routine.

It appears that this is a very active scam, and evidently quite successful.  Pass this on to all your family and friends.

Missed Call Scam

The consumer advocacy coalition Wireless.org ® recently warned wireless consumers across the United States about the latest twist on a “missed call” scheme.

Wireless companies have detected a pattern of calls that ring their customers’ numbers once or twice and then disconnect. When the number appears on the customer’s cell phone as a missed call, it appears to be a typical domestic three-digit phone number starting with the “649” area code. If the customer decides to return the missed call, the call is returned to an Adult Entertainment chat line in the Turks and Caicos, outside the reach of US regulators. While the wireless companies are working to block suspicious numbers on their networks, some individuals may be victims of this and similar schemes involving international area codes and end up being billed for expensive international call and chat line charges.

Wireless.org urges wireless consumers to always check an area code first before returning a call to an unknown caller. Be skeptical about area codes you don’t recognize, especially: “649” (Turks and Caicos); “809” (Dominican Republic); “284” (British Virgin Islands); “876” (Jamaica); “758” (St. Lucia); or “664” (Montserrat). There are dozens of area codes (mostly in the Caribbean Islands) which connect callers to an international telephone number. In addition, if you do not make international calls, ask your wireless carrier to block outgoing international calls on your account.