New Auto Fraud Laws Are Needed Says Insurer

Ontario will have new laws to combat and prohibit various forms of auto insurance fraud if a major insurer succeeds in convincing concerned offices that these are needed.

Insider Speaks Up

Aviva Canada’s senior manager of fraud operations Chris Lang says that there is a need for a more effective and efficient prosecution of auto insurance fraud in the provincial level. He says that those that knowingly present a false insurance claim should be charged with a provincial offence.

In Canada, fraud is classified as a federal offence but Aviva is opening the discussion for non-criminal provincial offences. These offences include workplace safety infractions, Highway Traffic Act violations, and discharging contaminants.

Most provincial offences in Ontario are either strict liability offences or absolute liability offences. This means that unlike a Criminal Code offence like assault or theft, the prosecutor does not have to prove in court that the accused person has a ‘guilty mind’ for strict liability or an absolute liability offence. More so, if charged with a “strict liability” offence, the accused person can defend herself or himself by providing that reasonable steps were taken to avoid the act.

A Clarification

Aviva is not pushing for auto fraud offences to be classified as absolute liability or strict liability offences, only that they’re pushing for a possibility that these new provincial offences may have a lower burden of proof than what is required for a burden of proof for criminal offences. According to Chris Lang, the idea is to call out those who intentionally and willfully commit fraudulent acts to gain financial advantage by deceiving companies. An example of this are people who file altered or forged documents for insurance claims either to file a false claim or file for a substantially larger claim. Another example is those that use fake information in their auto insurance application to get a lower premium, this fraud is under rate evasion.

Changes Are Truly Needed

Chris Lang adds that the Canadian insurance industry needs to work together and talk about solutions for addressing issues with fraud. He adds that in order to make meaningful changes, the auto insurance sector needs to work with front line consumers, the police, regulators, and the government, more so that by Aviva estimates, the Canadian auto insurance industry loses up to $2 billion a year to fraud.

Lang suggests that thinking the criminal justice system can adequately deal only a handful of auto insurance fraud cases make it to the reaches of public authorities and that an even smaller number results in a criminal sentence. The crown attorneys and the police simply don’t have the resources to contend with auto insurance fraud in light of everything else they are also handling.

74% or 3 out of 4 respondents in an Aviva poll said that they will support having a new set of provincial insurance fraud offences. The Pollara Strategic Insight survey involved 1,500 respondents from Ontario and was commissioned by Aviva in October 2018. The results have an accuracy rate of 19 out of 20.

Fighting fraud is made better by taking a proactive role against it. For more fraud prevention news, our private investigation blog is a great place to start. Contact us to dig up information against fraudsters or if you need help safeguarding yourself or your business against fraud.

Understanding the Real Cost of Fraud for a Business

It is undeniable that fraud can happen to anyone, including businesses big and small. When it is discovered that you or your business was a victim of fraud, accepting that fact and finding out that someone you trusted chose to steal from you is definitely challenging to deal with, not just financially but emotionally as well.

Anger typically follows the discovery and acceptance phase followed by feelings of grief, putting a strain on employees and the management thereby affecting the health of the entire organization.

How Fraud Affects Victims

Since we’re talking about fraud in the business sense, let’s look in to the possible effects of fraud when a business owner finds out that a trusted employee has been stealing from the company. Say a bookstore owner whose business is going bad discovered that an employee has been stealing books from the store. Then it was found out that the stolen books were donated by the employee to a good cause, a cause that the business owner fully knows his employee his passionate about because they’ve known each other for years beyond just work. How will this affect the business owner?

For one, there is a huge financial loss, more so for a business that is already struggling. However, there is also some moral dilemma considering that the stolen goods were used for a good cause, something that the business owner was aware his employee cared deeply about.

Asset misappropriation such as the case described here consists 89% of all cases of occupational fraud according to the Report to the Nations (ACFE). The loss from these types of crimes has a median value of $114,000, a huge loss that can make a small business go under.

In this case, the cost of loss over the years wasn’t more than a few thousand dollars but that amount could have meant life or death for a small business. To find out all the details of the fraud, private investigators were hired and an accountant and an auditor were paid to go over the company’s finances, almost doubling the cost of the theft.

The impact of this fraud for the business owner goes beyond financial loss. How can he trust his other employees when the one he trusted the most and thought of as a good person stole from his business? He may have to investigate deeper to find out if other employees were involved in fraud too, especially because his business is not doing good; which could have been a direct result of employees stealing.

The work environment will suffer as well. Everyone would be subject to suspicion and people will try to get out of a sinking ship, even if they did nothing to cause problems.

What to Do to Save the Business

When this happens, it is important for the business owner to talk with other employees and keep communication lines open to prevent further deterioration of the work environment and to help save the business. When investigations are ongoing, it is important for the other employees to be reassured that they won’t get in trouble unless they were also employed in occupational fraud.  The faster and more efficient the investigations are done, the easier it will be to go back to business and for the organization to hea and recoverl.

Are you dealing with theft or occupational fraud in your business? Hire our private investigators to find out the truth and help you devise ways on how to prevent fraud. Contact us at Haywood Hunt!

Holiday Scams to Be Aware Of

The holiday season usually brings with it increased criminal activity because people are often more generous and less wary during the season of giving. Here is our latest compilation on holiday scams that you should watch out for this year.

Fake Charities

People usually feel that giving to charities is a traditional part of the holidays and scammers are quick to take advantage of this to solicit donations via email, phone, social media, and even by knocking on your door. Just to be on the safe side, do a quick research before giving to any charity and verify that they’ve had a long presence before handing over your money. Refrain from responding to phone calls, emails, and the like until after you’ve verified that the charity is legitimate and that you are being contacted by the right people.

Gift Exchange via Social Media or Online Fora

There are various schemes that offer you rewards for giving a small fee. These schemes typically work like pyramid scams and will do anything to gain new members to keep the con going.

Letters to Santa

Refrain from giving out your personal information to companies offering personalized letters from Santa as the majority of these companies are not legitimate and are just phishing for information.

Fake Websites

Fake websites or misleading websites are in full swing during the holidays. You might think that you are logging in unto a site that you use but the moment you enter your username and your password, crafty scammers can steal your data. Always make sure that you are at the correct site before logging in.

Request for Use of Unusual Forms of Payment

Most websites and vendors accept credit card and Paypal payments via encrypted connections but scammers might ask for gift cards, prepaid debit cards, wire transfers, or other means to receive untraceable payment.

Bogus E-Cards

Electronic cards are a fun way to send holiday cheer but be sure to not click on links that do not identify the sender or those that require you to provide personal details. You’ll never know how the information you share may be used.

Fraudulent Shipping Notifications

If you’re not expecting a parcel, chances are there is no parcel and you’re being targeted for a scam. Some might send you emails and ask for a small delivery fee or want you to provide an ID before they can deliver the non-existent parcel. Just ignore them.

Free Gift Cards

One of the oldest internet scams. Offers of free gift cards just to complete a survey asking for your personal details are nothing but a scam.

Emergency Scam

Beware of calls claiming to be from loved ones or friends who are caught on an emergency. Oftentimes the caller will claim to be a relative or a friend on a holiday abroad with no means of getting home and will ask for money. Try to contact the real person via social media, email, or phone just to be sure.

Holiday Jobs Scam

Some scammers send out emails announcing that a big retailer is hiring for a temporary holiday job and all you need to do is provide personal information to be shortlisted for such jobs. Unless you can verify this from the retailer’s official website, keep in mind that it is unlikely that they’ll know your email to tap you for such an opportunity.

Do you think that your personal information has been compromised or feel that you’ve been targeted by holiday scams? Contact us if you need a private investigator in Toronto! We’re here to help!

Insurance Group’s Top Officers Allegedly Frauded Investors About $47 Million

The BCSC or the British Colombia Securities Commission recently issued a notice of hearing regarding fraud involving the top officers of a fast-growing insurance company. The insurance group’s leaders allegedly frauded hundreds of people by convincing them to purchase unsecured loan agreements.

Planned Fraud?

FS Financial Strategies Inc directors and founders Aik Guan “Frankie” Lim and Scott Thomas Low allegedly raised more than $47 million from 2012 to 2017 by failing to inform their investors that the company is in dire financial situation, not profitable, and was trying to cover expenses by raising money from unsuspecting investors.

The issued notice says that the company’s general manager Darrell Wayne Wiebe is aware of the true financial condition behind FS Insurance Group and helped commit fraud by advising Low and Lim about the amount of money that the company needs to raise from investors to stay in business.

BCSC disclosed that investors were promised monthly interest payments between 10% and 12% and basically created an illusion of profitability courtesy of Low’s and Lim’s actions. The duo reportedly opened new offices one after the other, donated money to charities, told customers that they are planning to take the insurance group public, and hosting expensive hotel parties for customers and staff.

More People Involved

The BCSC notice of hearing named 6 additional persons – Chun Ying “Jim” Pan, Chung-Sheng “Johnson” Kao, George Lay, Gagan Deep Bachra, Chi Kay “Dixon” Wong and Meng Cher “Philip” Tsai. These 6 individuals were appointed by Low and Lim as directors of FS Insurance Groups related companies and were part of the companies that allegedly sold securities without a prospectus and without a registration that allows them to engage in such business dealings.

Lim and Low are further alleged by the BCSC to have violated the B.C. Securities act by still engaging in the trade of selling securities despite making a legal promise to the BCSC’s executive director in 2014 saying that they would stop. This is aside from selling securities without registration, selling securities without a prospectus, and other allegations of fraud.

A Hearing is On Its Way

Everyone named in the notice is expected to attend the hearing scheduled on December 4, 2018, at 9 in the morning. Interested parties may view the notice of hearing at the BCSC website by using the search bar to look for the term ‘2018 BCSECCOM 330’ or any of the names of the respondents. If looking for information regarding disciplinary proceedings, it can be found in the BCSC website’s Enforcement section.

Note that the BCSC or the British Columbia Securities is an independent provincial government agency that is responsible for the regulation of British Columbia capital markets through the administration of the Securities Act. They act to protect a competitive and dynamic securities industry to provide investment opportunities to people and foster a securities market that is fair and trusted by people.

Are you in need of help from a private investigator in Canada to gather information to investigate a fraud? Contact us and we’ll discuss with you which of our private investigation services will be best for your needs.

Indian Call Centers Linked to CRA Scam Raided by Police

Call centers used by scammers contacting Canadians under the pretense that they are with the CRA were raided by the police in October, possibly putting a stop to suspected illegal centres that are involved with fraud.

Call Centres Raided

Several call centres were raided by the Indian police resulting in the seizure of equipment used for fraud and arrest of suspected perpetrators. This is a huge development in the investigation of the rampant cases of CRA fraud that have been targeting unsuspecting Canadians over the years. Combined loses from CRA scam cases is estimated to be in the millions of dollars.

Noida Station Chief Ajay Pal Sharma says that the raids are just the beginning and that they will be conducting more raids aimed at other illegal call centres operating in their city. At present time, 28 people have been arrested including 2 who are considered as kingpins of the operation. The suspects are young and are mostly in their 20s. They will most likely face fraud charges and serve some jail time.

International Police Effort

The recent events are the result of the cooperation between Indian police and Canadian police. Canadian police went to Noida, a suburb in New Delhi India, after a CBC Marketplace investigation revealed the location where scammers are operating. An RCMP officer in India then contacted Indian authorities in cooperation with the FBI to plan the raids.

RCMP financial crimes head Supt. Peter Payne says that they are determined to take the scammers down and that it is only a matter of time before they track down other the fraudsters who are involved in CRA scam operations.

Widespread Scam

It is believed that dozens of fraudulent call centres are operating in various cities in India complete with managers and access to technology that allows them to continue their fraud while avoiding detection. Indian security observers divulged that it is possible that some of these centres are operating with police approval.

A spreadsheet containing the details of more than 600 Canadian scam victims was found in one of the raided facilities, a testament to how rampant and serious the situation is. Meanwhile, arrested suspects were paraded on national television in India to send a message to other perpetrators of the same fraud.

Beware of CRA Scam

The CRA scam works with the use of spoofing technology that makes the Indian callers seem like they are from Canada. They tell the victims that they are from the CRA and claim that the victim owes a lot of money in taxes and that they can be arrested or imprisoned if they don’t cooperate and resolve the matter quickly. The victims are then made to pay what they supposedly owe via iTunes, gift cards, Bitcoins, or some other forms of payment. The CRA says that they will never threaten taxpayers over the phone and will never ask for tax payment using unofficial methods.

Have you been a victim of CRA scam or any other scam? Make sure that you avoid fraud by keeping yourself informed about the latest fraud news in Canada. If you need help investigating a possible fraud, contact us and we’ll talk to you about your options.

Man Lost $600K to Evil Spirit Blessing Scam

A woman from Toronto was charged by York Region police after allegedly using witchcraft to scam $600K from an elderly man. The woman was charged with fraud for pretending to practice witchcraft in order to pull off an “evil spirit blessing scam”.

Self-Proclaimed Psychic or Fraud?

The 27-year-old suspect, a self-proclaimed psychic, was arrested after a year of investigations regarding her interactions with a 67-year-old man from York Region who claimed that he lost about $600,000 to her scheme. Authorities began the investigation after they received an anonymous tip talking about an incident of elder financial abuse in November 2017. They found out that the man had to sell his house upon the accused’s alleged prompting so that he can get rid of evil spirits in his home. The woman then told the man that she will hold on to the money until after the spirits were removed but no money was returned to the man. Instead, the woman allegedly asked for an additional $6,000 for a ritualistic burning for which the man used credit and sold his car for just to meet the woman’s demands for money.

Evil Spirit Blessing Scam is a Possible Trend

York Regional Police shared via Const. Laura Nicolle that this incident is not the first of its kind recorded in the area. Const. Nicolle shared that they’ve uncovered similar incidents in Markham in 2015. The modus is the same. The fraudsters convince homeowners that there are evil spirits surrounding them and placing them and their family at risk. The victims are made to feel that they are in dire circumstances and must act fast with the help of the scammers or face a possible threat. The fear that the scammers cultivate in their victims explains why victims willingly part with huge sums of money in the hopes that they and their family will be safe.

The police also shared that the fraudsters typically target the elderly or people who are new to Canada, such as in the case of the Milton woman who was arrested recently by Halton Police for extortion, fraud, and pretending to be a witch. The Milton woman allegedly scammed her victim out of $60,000.

How to Avoid Falling Victim to Evil Spirit Blessing Scam

The scammers involved in this scam often claim to be practitioners of magic or witchcraft and find their victims by approaching in person or posting ads online. One concern shared by the police is that it is not easy to identify who will be targeted next because this scam involves someone’s personal concerns regarding beliefs in evil spirits, something which people don’t usually talk to the police about.

Const. Nicolle says that if you know someone who’ve fallen victim to this scam, the only way to retrieve stolen assets is to file a case or to use the court system. The best way to avoid becoming a victim is to avoid talking to people you don’t know online and in person, especially if they claim to be practitioners of magic or witchcraft and try to look at things from another perspective.

If you know someone who might be a victim of the evil spirit blessing scam or suspect that you are being targeted by a fraudster and wanted to be sure, feel free to contact us for our private investigation services. We can gather information to help you file a report or a case of fraud to the police. Contact us at Haywood Hunt today!

Something Fishy – Seafood Fraud in Canada Uncovered

Investigators found out that many of the fish sold in Canadian supermarkets are mislabeled seafood, with estimates placing the fraud to be affecting approximately half of the seafood sold in Canadian stores.

The seafood fraud is more than just being charged more for a premium fish and getting a cheaper variety. In some cases, the mislabeling may also pose as a health risk such as in the case of white tuna being switched with escolar, a type of fish that can cause stomach problems such as diarrhea and vomiting.

Widespread Mislabeling

In a  study conducted by advocacy group Oceana Canada, about half turned out to be mislabeled, seafood fraud campaigner shared Julia Levin. This was from a sample of 382 composed of sole, bass, snapper, and other fish from 177 restaurants and retailers in 5 Canadian cities. Ontario-based lab Tru-ID used DNA to identify the type of fish in the samples and found that 44% were not what was indicated in the label.

The study found that 100% of the samples for butterfish, yellowtail, and snapper were labeled incorrectly while 30% of the samples for sole, halibut, and tuna were incorrectly labeled as well. The fish were usually replaced with Japanese amberjack, escolar, or tilapia as identified by DNA. 52% of the samples from restaurants were mislabeled and 22% of those from markets and groceries turned out to be mislabeled as well.

The above report is currently being reviewed by the CFIA, the authority responsible for monitoring food fraud in Canada and mitigating food safety risks. It is to be noted that previous studies had the same results.

 

Fishmonger Hana Nelson of Afishionado says that she would like to believe that the rampant mislabeling issue wasn’t intentional and was just a result of human error.

Supply and Demand Fuels Wrongful Practice

Seafood is often mislabeled because of the many opportunities for mislabeling that are present from when the fish are caught, processed, and sent to retailers. This means that the stores or restaurants from where the samples were taken may not know that they’re victims of seafood fraud as well.

It is common in the fish industry for expensive fish to be replaced with cheaper alternatives. At the current time, industry insiders are convinced that the mislabeling is not just a case of an employee mistakenly placing the wrong label on some of the fish, but a deliberate act by some who are driven by profit. It is to be noted that the practice of seafood mislabeling was first discovered via DNA lab results a decade ago.

Health Dangers

The danger with seafood mislabeling is that people who have allergies may accidentally eat fish they’re allergic to. Harmful fish products such as escolar might be ingested and could cause serious health issues or even death. Plans are currently being drawn to try to find a way to impose traceability for seafood products to decrease fraud.

Are you in the seafood business but not sure whether your seafood suppliers are free from fraud? Our private investigation services may be able to help. Contact us at Haywood Hunt for a consultation on how our private investigators can assist you.

CRA Asked for Help Against the Fight for Mortgage Fraud

Mortgage fraud is on the rise, with more people claiming to make more than they really do in order to qualify for bigger loans. In light of this, the CMHC is aiming for lenders to get access to mortgage applicants’ tax data so that they can identify those who might inflate their declared income in order to qualify under the new rules.

Fraud Detection – A Priority

CMHC released a statement saying that the current detection tools used by the mortgage industry are not at par with the level of fraud some people are resorting to, placing a limit on what fraud can be discovered or remain concealed.

The CMHC also shared via email that as of now, they do not know yet when the Canada Revenue Agency might help with the income verification although some industry experts predict that the cooperation between the CRA and CMHC could roll out in early October.

It is to be noted that CMHC is the largest mortgage insurer in Canada. In fact, they’ve insured 107,000 homes in just the first half of this year.

Rise in Mortgage Fraud

A 2017 study by Equifax states that mortgage fraud has risen 53% from what it was in 2013. This study did not specifically state the number of discovered fraud cases although a survey by the same firm found out that as much as 13% of Canadians would have no qualms about fudging their mortgage application.

Today’s stricter mortgage rules are fueling the fraud climate, making it more tempting for Canadians to lie on their mortgage application by inflating their income. For years, only a signed income form was required by some banks and what made it possible for contract workers and those who are self-employed to get a mortgage.

Better Verification Needed

Lenders accept printed income statements from the CRA website although they are reportedly easy to alter and cannot be verified because the CRA is not allowed to give access to a taxpayer’s information to any third party even when a written permission is granted by the taxpayer in question. This will change under the CMHC proposal because it would give direct access to the CRA data so lenders can verify the income information provided by borrowers. Not everyone agrees to this, as compared to the rest of the world, Canada’s mortgage delinquency rate is very low.

Mortgage brokers, such as CYR Funding owner Rena Malkah thinks that income verification should be left to underwriters and that a person’s credit rating is a better gauge of one’s financial status, adding that someone with a good credit rating is good at managing bills and paying them on time. Still, some mortgage professionals like Vine Group’s Peter Kinch thinks that now is the time for the CRA to be involved in income verification, adding that a similar system works well in the United States.

Are you needing help with verifying some information related to your mortgage business? Contact us to inquire about how our private investigation services can be of benefit to your business’ fraud prevention!

Laurentian Student Victimized by CRA Receive $600 from Kind Stranger

Do you know that more than a thousand Canadians have fallen victims for CRA scams last year? They’ve collectively lost over $4 million and the majority of scammers are still out there, victimizing even those who are struggling financially.

Unbelievable Turn of Events

A student in North Bay have fallen victim to the same telephone tax scam and faced a huge financial loss. Thankfully, a kind stranger heard of her ordeal and donated $600 to help her cope with her financial losses. The stranger gave her $600 just hours after she shared that fraudsters claiming to be from the Canada Revenue Agency were able to scam her out of money.

An Extraordinary Act of Kindness

Beverly, not her real name, the 29-year old student, was moved to tears as she shared how moved she was that someone who doesn’t know her at all would help her out in her time of need. She also expressed wanting to thank the donor in person.

The donor, who remains anonymous as Dan T, shared that he knows how it feels to fall victim to a phone scam, inferring that the donor was a victim of the same scam that targeted Beverly, if not some other type of fraud.

The Scam Story

Beverly, just like the other victims of the same scam, shared that the con started when she received a pre-recorded voicemail warning her that she is facing arrest. The digital voice claimed to be from the tax department of the Canada Revenue Agency and said that there is a lawsuit that they’ll be filing under Beverly’s name with a warrant for her arrest. She was told to call them back via a return phone number.

Beverly was aware of CRA fraud but said that she panicked and thought that the call was legitimate, especially after the call informed her that an officer will call to read her rights and another call that indicates that it is from the Ontario Provincial Police detachment flashed in her screen. She then pleaded to the person she thought was a police officer for about 3 hours to no avail. The caller then instructed her to pay $600 in Bitcoin currency to avoid getting arrested and facing a lawsuit. After she paid that, she was told that she needs to pay another $400 for court costs and officer’s fees. She then ended the conversation and called the police who informed her that she fell for a scam.

Canadians Beware!

It is to be noted that the Canadian Anti-Fraud Centre reported that about 1,000 Canadians fell for the same type of scam in 2017, collectively losing about $4 million.

Though it is heartwarming to hear of news about people helping scam victims, we must not be side-tracked by the fact that Toronto phone scams are rampant and it will still be best to not fall victim to them. We must arm ourselves with knowledge, read up on scam news, and make sure to take the right steps forward once a phone scam is suspected. Contact us for private investigation services if you, or someone you know, needs help.

Protect Yourself From Mortgage Fraud and Real Estate Fraud

Mortgage fraud and real estate fraud are on the rise; and the frauds associated with them may take many different forms. As unsavoury as it is to think that these types of fraud happen around us, it is really of little wonder because fraudsters are opportunists and as such, they go for the biggest cons they can accomplish. Examples of the biggest heists in fraud are real estate fraud and mortgage fraud.

It is important to remember that the fraudsters behind mortgage fraud and real estate fraud are con artists who know how to use modern technology to their pull off their fraudulent schemes. They are able to do this because they know how the real estate process works and are able to spot loopholes that they can use against their victims.

Real Estate Title Fraud

Real estate title fraud is often made to look like a legitimate real estate deal by the fraudsters claiming that they now own the  target property because it was sold or gifted to them by the owner. The usual target here are seniors because it is more believable for a senior homeowner to sell or give their home away, aside from the fact that they usually have the largest assets which makes them attractive targets for fraudsters.

The thief obtains the land title of the victim’s home using a fake transfer document. The details in the document are usually compiled from information that were carelessly shared online (like posting photos of official documents on social media) or from a compiled database full of identity-theft data from target victims.

Mortgage Fraud

The title is then used to get a mortgage that the fraudster will never pay. The hapless homeowner is usually informed only when the home is near foreclosure. Imagine losing your home without knowing anything about an unpaid mortgage!

The average real estate fraud costs around $300,000. Nearly none of the fraudsters involved in schemes like this are ever caught and the homeowners are the ones who are left to cope with the aftermath.

How to Prevent Mortgage Fraud and Real Estate Fraud

People who have access to your personal information may use what they know about you to target you for fraud. The first step towards protecting yourself from being a target for fraud is to restrict what personal information you share publicly and limit who can access your information in the real world.

The above means doing all that you can to prevent identity theft and not being too trusting of neighbours, friends, caretakers, or even distant relatives. Your mail, bank statements, deeds and titles, insurance information, and all financial details must be kept where only you or a person you trust can access. This also means not giving away sensitive information over the phone (some fraudsters will pretend to be from the bank), not writing down your credit card details where unauthorized people may see them, and destroying mail before throwing it in the trash; basically following all the sensible steps to avoid fraud.

If you need a private investigator to check your vulnerability to identity theft, mortgage fraud, and real estate fraud, our private investigation services can assess your risk factors and help you address them. Contact Haywood Hunt today!