Identity Protection and Fraud

As technology continues to advance at its’ current rapid pace, our daily lives and interactions are on a constant pursuit to ensure that we remain on par with these changes and innovations. Technological advances continue to enhance routines, changing the landscape of the entire world. Whether it’s smart cars becoming better drivers than us or drones delivering packages at an unprecedented speed. Or it’s the breakdown of physical restraints in the workforce and school via computer programs and video conferencing. Perhaps it is the constant innovations that smartphones develop which allow us to have “the whole world in our hands?” There are no questions as to the impact technology has on the globalized world. However, as uncle Ben so eloquently told Peter Parker, “with great power comes great responsibility.”

While we, as consumers, are experiencing great joy in these technological pursuits and creations, our identity continues to face great risk. No, this is not advice to begin soul-searching who we really are, but rather our actual identity and personal information are now at a greater risk than ever before in history. The online, digital work, with its endless possibilities and powerful pursuits, simultaneously opens the door for identity theft and fraud. The more information we put online, the higher the risk associated with these devastating issues.

In Canada, from January 2014 to December 2016, it is estimated that Canadians lost over $290 million to fraudsters (Competition Bureau, 2017). In fact, Canadians aged 60-79 have lost almost $28 million in the same time period! The Canadian Anti-Fraud Centre (CAFC) and the Competition Bureau have received almost 90,000 complaints in 2016 compared to just under 70,000 in 2015. In 2016, it was the online scams that accounted for more than 20,000 complaints and more than $40 million in losses by Canadians. To emphasize the point further, it is estimated that only 5 percent of fraud gets reported to authorities, which means the number of actual frauds that occurs amongst Canadians is substantially higher.

What is identity theft?

Simply put, this refers to an individual stealing personal information about yourself and using it for their own agenda. For example, they may try and open a credit card in your name or buy a product online. If successful, they walk away with cash in hand and you are now responsible to fix the mess. This does not mean that you will 100% pay the price but rather, you will need to take the necessary steps required to fix the current situation and ensure that it does not happen again. While this scenario is extremely unfortunate, the reality is that it is very difficult to ensure that it does not happen. After all, with these advances in technology that benefit consumers, hackers enjoy it as well and use it to their advantage to do things that breach way beyond the ethical boundary. However, in addition to identity theft, there is also an increase in fraud with a different intention.

What is fraud?

The term fraud generally refers to an individual claiming to deliver a promise but really has no intention in fulfilling his word. As the digital world continues to increase its global presence, “fraudsters” or “scammers” are appearing in droves to prey on innocent people in the hopes of robbing them of their hard-earned money. We hear about the “CRA scam” where fraudsters claim to be the CRA and demand tax money or you go to jail. Or the online lender who promises you fifty thousand dollars if you simply send them a few hundred dollars. The examples can go on and perhaps you can think of your own experience where an individual attempted to fraud you? What can we do as consumers to ensure that we are not victims of these scams and how can we prepare ourselves in this digitalized world?

First, reputation is extremely important to determine before proceeding with any offer. This can be done by conducting basic research about a company, reading reviews about what other customers have to say and ensuring that past associations with the company or individual have been verified.

Second, follow your intuition. As Malcolm Gladwell points out in his book Blink, don’t ignore your intuition but rather follow your gut, it may be more on par than you think. If you are experiencing a situation and variables begin to cause feelings of uneasiness or mistrust, ask yourself why you feel that way. If you are unable to provide adequate answers and you truly feel that something is just not right, perhaps you are a potential victim of fraud.

Third, ensure that basic security requirements and certificates are adhered to and are present. If you are purchasing a product on a website, make sure that it has an SSL certificate and meets the requirements of being a verified on-line vendor.

For example, an online lender such as Magical Credit meets all the above criteria. It is reputable as is seen via the numerous reviews of happy customers. The process required to receive a loan aligns with basic intuition regarding income and identity verification. And third, it has all the possible online securities that finance companies require. As a reputable lender, Magical Credit ensures that borrowers receive all funds first before any payments are due and it protects its customers via various identity tools to ensure that customers themselves are not being frauded. So, if your checklist is met, you should be safe from becoming a victim of fraud.

By Gregory O’Connor, Financial Advisor