With an ailing grandson in the Philippines, homeowner Albina Morales took out a second mortgage to use some of the equity to help pay the medical bills and her mounting debt.
Through word of mouth in her community, she connected with a man claiming to be a broker who could refinance her mortgage to meet her goals.
“He gave me $30,000 and said he would use $92,000 to pay off my debt,” recalled Morales, at the Toronto Police Fraud Prevention Month kick-off on February 26 at police headquarters. “I agreed and signed all the documents.”
Little did Morales know at the time that she was the victim of fraud that could haunt her for the rest of her life.
Constable Kevin Williams, who was with 55 Division Fraud Section at the time, was the officer in charge of the case that was brought to his attention in 2007.
“This lady knew something was really wrong when creditors started calling her for their money,” said Williams, who is with Financial Crimes. “At that time, she tried to locate this man without success. I was able to show that he used the money for his personal gain.”
Morales lost her home and is now living in subsidized housing.
“That’s the unfortunate thing here and she’s still saddled with all that debt she wanted to pay off,” Williams added. “While the accused was convicted in court, the sad reality is that we don’t know where that money went. She will be struggling with that debt for the rest of her life.”
Financial Crimes specialists underlined that gender, age or socio-economic status don’t matter when it comes to fraud.
Busy with her business and a mother with Alzheimer’s, commercial artist Kathryn Adams entrusted her bookkeeping to someone recommended by a chartered accounting firm.
“There was no reason for me to distrust her,” said Adams, who also shared her fraud story at the news conference. “I was busy at work, teaching and distracted by a wandering mother who was becoming more ill. The only thing I could have handed over to someone else was the bookkeeping.”
It took nearly a decade for Adams to discover that she was being defrauded.
“I was looking for the name of a store that I had been to in Montreal a few months earlier,” she said. “When I looked in the books for the store on my Visa bill, I started finding cheques that the embezzler had made out to herself. As I kept looking I found more and couldn’t understand why they were made out to her until I started going through my entire records. That’s when I called the police.”
Adams, who contacted law enforcement eight years ago, credits a next-door neighbour for helping to secure a successful prosecution.
“He was a forensic accountant and he took evidence and presented it in an organized way to police,” she said. “Many small businesses don’t have the financial resources to pay for a forensic audit, so I am eternally grateful to her.”
Adams said she lost a significant sum of money.
“I, however, got a portion of it back and I have a stand-alone restitution order to collect the rest,” she said. “My advice to people is to trust but verify. You don’t want to be paranoid. Be careful. Open your mail, sign your cheques, check the books and do random audits. People who commit crimes are slick and well-versed in telling a good story.”
As Canada’s largest urban centre and banking capital, Toronto is the main target of the scams, ranging from letters from purported wealthy Africans offering massive payments to get money out of their countries, to prize offers that involve calling a 1-900 number that ends up costing the consumer far more than the value of their supposed winnings.
“We are all equally vulnerable to the fraudster that would convince each and every one of us that they are genuine in their request for money,” said Staff Inspector Mary Lee Metcalfe, who heads the Financial Crimes Section of the Organized Crime Enforcement Unit. “However, the end result in all cases of fraud is the great personal loss of our livelihoods.”
As part of the launch, prevention pamphlets with useful methods to recognize specific fraud scams and a booklet containing the top 17 fraud schemes were unveiled. They are available to media and are available at the 17 police Divisions.
We would like to remind Canadians to remain vigilant and protect themselves against fraud, regardless of the medium used
“We have advanced these information booklets so that our community can be well informed on how to recognize these schemes,” said Metcalfe.
The Financial Crimes social media group and the Toronto District School Board have also collaborated to organize a “Don’t be Fooled” event during Fraud Prevention Month in March. It will take place on March 12 at Danforth Collegiate & Technical Institute.
“This particular event has been created for students who engage in social media to be smart about their online activities,” said Metcalfe.
Other speakers at the launch were Nish Vairavanathan of the Bank of Canada, Insurance Bureau of Canada investigator Kathy Metzger, Vasie Papadopoulos of the Financial Services Commission of Ontario and Lise Landry-Morson of Competition Bureau Canada.
“We would like to remind Canadians to remain vigilant and protect themselves against fraud, regardless of the medium used,” said Landry-Morson. “…Preventing fraud is a shared responsibility. When you see it, report it.”
Crime prevention posters designed by Seneca College students were displayed in the media gallery during the press conference.