Many years ago, the Canadian government imposed a rule that required currency operators to determine the purpose of a client’s transaction. The process of determining the purpose of the transaction can sometimes be awkward, as we need to look into our client’s privacy. Initially justified by an attempt to identify criminal activity, examining transactions has become a useful tool to intercept fraud.
Here is a recent example of fraud:
While asking one of our clients the reason for their transaction, they told us that they were sending USD to their best friend’s sister. Due to an unfortunate vehicular accident, their best friend’s sister was in hospital and in desperate need of an expensive procedure. Wanting to help, our client rushed over to initiate the transfer. We knew immediately that this request was fraudulent in nature.
Fraud During The Pandemic
Fraud is on the rise, especially during the pandemic. Along with medical fraud, we have been seeing a lot of romance fraud and puppy scams.
Romance fraud, sometimes dubbed “catfish scams” involves an online international relationship, where there is often no personal interaction but frequent transfers of funds to the fraudster.
Puppy scams occur when the client purchases a puppy (or other pet or item) online and, after sending either the deposit or the full payment, never receives the promised item.
Scams are often successful because they are believable and those people that fall victim are no less savvy than the smartest person that you know. These scams are a full-time job for fraudsters who are very skilled in their approach.
Catching Scams Before You Send Funds
We see a high volume of transactions and this means we are often able to identify scams before funds are released. The regulatory obligation that we have to identify the purpose of the transaction allows us to open the conversation and learn what our client is trying to achieve. Once we spot a red flag, we will share this information and hopefully help stop our clients from losing money on these scams.
If you have a concern about a scam that you believe you have fallen victim to, don’t hesitate to contact us. We’d love to share any insight that we can regarding the questions to ask and the steps to take to safeguard yourself.
