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Telephone and email solicitations, and investment schemes

Region: Ontario Answer # 280

Investment and securities fraud is increasingly common and the usual victims are those who can least afford to lose the money. Fraudulent investment schemes or scams are usually marketed by telephone using high-pressure selling techniques. The Internet and email are also common vehicles for scams and disreputable salespeople. Some of the most elaborate schemes and solicitations may even involve rented offices, colourful brochures and complex legal documents or offers.

Generally, any promise of large financial returns for a minimal investment, should be viewed skeptically. Sometimes, the fraud artists initially generate profits for investors using what is known as a “Ponzi” scheme. In this type of scam, initial investors received large dividends or cash from their first investment. Encouraged, the victims usually invest even more money. What they don’t know is that their “profits” are coming from monies invested by others. Since there is no actual investing in any assets, it is a house of cards that will eventually collapse when the fraudsters take off with the money.

The sale of securities and investments is tightly regulated in Ontario and other provinces. If an individual or company purports to be selling shares, stocks or other investment instruments, they must be registered and qualified by regulators.

Canadian Anti-Fraud Centre

The Canadian Anti-Fraud Centre (CAFC) is the central agency in Canada that collects information and criminal intelligence on fraud. It is also Canada’s fraud reporting centre for victims and complainants for all types of fraud, including:

  • mass marketing or telemarketing fraud,
  • advance fee fraud letters,
  • Internet fraud, and
  • identity theft complaints.

The CAFC is jointly managed by the Royal Canadian Mounted Police, Ontario Provincial Police, and the Competition Bureau. There are many known scams, and new ones arising every day. CAFC lists the latest scams as well as those that have been in existence for some time.

If you need more information, or would like to report a fraud, visit the Canadian Anti-Fraud Centre website, or call them toll-free at 1-888-495-8501.

For legal help, contact a lawyer.


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