Protecting our seniors: How to prevent elder financial abuse

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June is Seniors Month in Canada, a time to recognize the value, resilience, and continued contributions of older adults in our communities. It’s also an opportunity to talk about one of the fastest-growing threats to their well-being: elder financial abuse.

According to the 2024 CSA Investor Index, 36 per cent of Canadians say they are aware of at least one instance of elder financial abuse, up from 29 per cent in 2020. This rise signals that more Canadians are paying attention to the financial vulnerability of older adults. It is also a reminder that this is a growing issue, and now more than ever, we need to be vigilant and recognize the signs of financial abuse with older loved ones we care for.

The Alberta Securities Commission (ASC) hears firsthand from seniors about how these situations occur.  More often than not, financial abuse is subtle, persistent, and emotionally complex, which is why it can be hard to talk about and even harder to report. Financial abuse may not be immediately obvious, but the earlier it is identified, the better the chance of limiting the damage and preventing it from happening to others.

 

How seniors are being targeted

Financial abuse can take many forms, and fraudsters continue to adapt their tactics to take advantage of seniors. In some cases, they offer seniors what appear to be legitimate investment opportunities, often through cold calls, emails, messaging apps, or social circles. These fraudsters typically work to build trust quickly, using charm, familiarity, or shared interests to gain credibility before making their pitch.

Understanding these tactics is key. Our Fraudsters’ Playbook outlines the common steps scammers follow to build trust, manipulate emotions, and push victims into rushed decisions. The person making the pitch may not be registered to sell investments, may not provide clear documentation, or may urge the senior to act quickly without speaking to anyone else.

Another scam we continue to see is recovery room scams, where victims of previous fraud are contacted by individuals claiming they can help recover their lost funds for a fee. These scams can be especially damaging, as they often exploit a victim’s sense of desperation and hope for financial restitution.

Financial abuse, however, isn’t always the result of fraud. In some cases, it comes from someone the senior already knows and trusts. A family member, caregiver, or close acquaintance may gradually take control of financial decisions, gain access to accounts, or pressure someone into making risky or unfamiliar investments. This type of abuse can be subtle and difficult to identify, especially when it’s framed as support or occurs during a period of emotional or cognitive vulnerability.

With older adults managing their finances more online, fraudsters are using increasingly sophisticated digital tools to manipulate, deceive, and steal. Messaging apps like WhatsApp or social platforms like Facebook are being used to distribute fraudulent investment schemes, sometimes disguised as tips from “trusted” sources, making it harder to recognize the scam until it’s too late.

 

What you can do to help protect seniors

While the methods used to target seniors with investment scams are growing, the steps we can take to protect ourselves and those we care about remain clear and effective.

  • Check registration with CheckFirst: One of the most important things anyone can do before working with an investment professional or firm is to check registration. In Alberta, generally, any individual or firm selling investment products or offering advice must be registered with the ASC or another Canadian securities regulator. If they aren’t, this is a red flag, and there is a risk that the person or firm is operating outside the law.
  • Have a conversation: It also helps for concerned family members or trusted friends to talk openly and respectfully about financial matters, especially with aging loved ones. These conversations can be difficult, particularly when they involve suspicion or concern, but they are often the first step in identifying when something feels off. Asking questions, encouraging second opinions, and sharing reliable resources like ca/Seniors can empower older adults to make informed decisions and recognize red flags early. If someone is experiencing financial abuse, there are organizations and support services that can help. For more information on elder abuse, visit albertaelderabuse.ca.
  • Report it: If you suspect someone is being targeted or has already been affected by investment fraud, please report it to the ASC immediately. While the ASC is not able to address cases of broader financial abuse, we are committed to helping Albertans understand how to invest safely and how to protect themselves from investment fraud. Our checkfirst.ca website provides tools and resources to help Albertans protect their financial well-being, at any age. We want to hear from anyone who believes they have been caught up in an investment scam.

Preventing elder financial abuse is not just the responsibility of seniors–it’s a shared effort. Families, caregivers, neighbours, and financial professionals all play a role in creating an environment where older adults feel safe, respected, and informed about their finances.

As we celebrate seniors’ month, let’s honour the wisdom and contributions of older adults and take meaningful action to protect them from the growing threat of financial abuse and fraud. Together, we can help ensure seniors live with dignity, security, and peace of mind.

From saving to drawdown in retirement: Understanding RRIFs

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Imagine this: you have diligently saved towards retirement for decades, consistently contributing to your Registered Retirement Savings Plan (RRSP) or Group RRSP plan through your employer during your working years. Now, with retirement on the horizon, a new question arises: how do you withdraw from your hard-earned savings and create a steady income stream through your golden years? One way is through a Registered Retirement Income Fund (RRIF), the bridge between your accumulated savings and retirement.

 

What is a RRIF and how does it work?

Much like other registered accounts, the Registered Retirement Income Fund (RRIF) is a tax-deferred retirement account available to Canadians. However, the RRIF is not an account to which you can contribute. Rather, it is an extension of your RRSP.

RRSPs are designed to help you save for retirement by allowing tax-deferred growth on your savings and investments until you’re ready to withdraw them. Your accumulated savings and investments from your RRSP can be transferred to a RRIF, which automatically creates a routine annual drawdown process of your assets to provide an income stream.

Similar to the RRSP, the RRIF also offers you the option to allocate your underlying funds to a number of investments such as stocks, bonds, mutual funds, Exchange Traded Funds (ETFs), and Guaranteed Investment Certificates (GICs). You can also transfer funds into a RRIF from a Pooled Registered Pension Plan (PRPP), a Registered Pension Plan (RPP), a Specified Pension Plan (SPP), another RRIF, or from a First Home Savings Account (FHSA).

 

When to convert and what to consider when converting a RRSP to a RRIF

An RRSP can be converted into a RRIF before standard pensionable age. Once converted, no additional funds may be added to it. However, a crucial deadline exists. By the end of the year you turn 71, your RRSP must be — transferred into a RRIF, converted into an annuity, or paid out as a lump sum. Failure to convert your RRSP to a RRIF will result in your account being deregistered, leading to serious tax issues.

If you realize you have opened a RRIF too early and change your mind, it can be converted back to an RRSP as long as the account owner is 71 or younger. It is best to consult a financial advisor who can provide personalized advice based on your situation.

 

Understanding RRIF withdrawals

A hallmark feature of a RRIF is its mandatory minimum withdrawal. Unlike an RRSP, where you can grow your money untouched, the Registered Retirement Income Fund requires you to take out the minimum required amount each year.

There are some factors to consider when withdrawing from your RRIF:

  • The minimum percentage: The minimum withdrawal amount is calculated based on percentage of your RRIF’s total market value at the end of the previous year. This percentage increases as you age, reflecting the idea that you will need more income as you get older. If your spouse is younger than you, the minimum withdrawal can be based on your spouse’s age, allowing for lower minimum payments and longer tax-deferred growth.
  • Finding the right amount: Since a RRIF offers tax-sheltered growth only on the money that remains within the plan, all withdrawals, including the minimum amount, are considered income and taxed at your marginal tax rate. While the plan offers the freedom to withdraw more than the minimum if needed, it’s recommended to consider the following before doing so:
    • You could deplete your savings faster than anticipated.
    • The amount of taxable income increases as you withdraw more.
    • This can impact eligibility for certain government benefits like the Old Age Security (OAS).

 

Should you convert your RRSP early?

The decision to convert your RRSP to a RRIF is a significant milestone when planning for retirement. While some people might wait until their income is lower to convert, there’s no one-size-fits-all answer.

There can be some advantages to converting early, like accessing your savings sooner. However, there are also drawbacks. To make the best choice, consider your retirement timeline, goals, health, and spouse’s age and income. These factors will influence your future needs and tax implications.

The best choice for you will depend on your individual circumstances. Talking to a certified financial advisor can help you weigh the pros and cons and decide what’s right for your retirement goals.

 

What happens to a RRIF when the annuitant dies?

By default, upon death, the value of your RRIF becomes taxable income of your estate. To prevent this, you can name a beneficiary or a successor annuitant.

  • Beneficiary: You can choose anyone as a beneficiary. However, only a beneficiary who is 71 or younger can transfer the funds into their RRSP without affecting their contribution limit. The RRIF account is then closed, and your estate avoids income tax on the amount.
  • Successor annuitant: Only your spouse or common-law partner can be named a successor annuitant. In this case, they will take ownership of the RRIF and have the choice to continue receiving payments, transfer the assets to their own RRIF, or delay the annual withdrawal by transferring it to their RRSP if they are 71 or younger.
  • Financially dependent infirm child or grandchild: Proceeds of a deceased annuitant’s RRIF can also be rolled over to the Registered Disability Savings Plan (RDSP) of a financially dependent infirm child or grandchild.
  • Financially dependent child or grandchild: The funds can only be transferred to a term annuity if the child or grandchild is financially dependent, but not because of a mental or physical impairment.

 

Investing as you age

Having a sound financial plan can play a significant role in helping you work towards your retirement goals. While building up your savings and investments for your retirement is a worthwhile endeavour, finding the optimal path to drawing them down is just as important. Take the time to learn more about RRIFs and how they can fit into your overall retirement strategy.

Planning ahead: Preparing for retirement

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Most Canadians aspire to having a happy and comfortable retirement. Achieving this goal requires proper financial planning and wise investment decisions. One of the commonly used investment vehicles to achieve this goal is a registered retirement savings plan. However, the question remains if this traditional investment method still holds merit for you.

What is an RRSP and how do they work?

An RRSP is a government-registered retirement savings plan in Canada designed for individuals to contribute funds with the specific aim of saving for their retirement.  Advantages of investing in an RRSP include:

  • tax-deductible contributions,
  • the option to make early withdrawals for a first home purchase,
  • compounded growth, and
  • the flexibility to convert an RRSP to a Registered Retirement Income Fund (RRIF) for structured periodic payments as early as age 55.

An RRSP must be opened before the age of 71, as stipulated by the Canada Revenue Agency. The annual contribution limit for RRSPs is set at 18% of the previous year’s earned income or a maximum dollar limit, whichever is lower. For 2024, the maximum contribution limit is $31,560. Exceeding this limit by more than $2000 will result in a 1% per month tax penalty on the excess contributions.

Withdrawals from your RRSP before turning 71 years of age will incur a withholding tax. The exact rate of tax depends on your province of residence. It is important to note that early withdrawals must be declared as income on your tax return and they will be taxed at your marginal tax rate. Additionally, withdrawals from an RRSP can result in permanent loss of the contribution room.

Starting RRSP contributions early in life can help you leverage the power of time and compound interest. This means that your investments have more time to grow, potentially resulting in a more substantial retirement fund. Additionally, early contributions allow you to take advantage of tax-deferred growth, which means that you can reduce your taxable income now and enjoy the benefits of tax-sheltered growth until retirement. Ultimately, starting an RRSP early can help you lay the foundation for a more secure retirement. Use the ASC’s RRSP calculator to see how contributing often and early can benefit your retirement plan.

What types of RRSP options exist for investors?

If you are considering opening an RRSP account, it’s important to know the available options to make an informed decision. Essentially, you need to decide whether you want to invest individually or in collaboration with others.

  1. Individual RRSP: An individual RRSP is registered in your name, providing exclusive ownership of the investments and associated tax benefits. This option is ideal for those seeking full control and ownership over their RRSP portfolio. Consider choosing a self-directed RRSP if you prefer to make investment decisions on your own. With a self directed RRSP, you have the flexibility to purchase and sell various qualified investments such as GICs, bonds, mutual funds, and more. However, keep in mind that commissions on transactions apply, similar to a non-registered brokerage account. Additionally, an annual administration fee may be applicable. Learn more about the different types of investments available to you.
  2. Group RRSP: A Group RRSP is a retirement savings plan that your employer offers. It may come with some enticing benefits, such as matching contributions. Matching is when your employer contributes to your RRSP as well, providing essentially free money for your retirement savings. Additionally, you may also enjoy lower management fees on the investments held within the Group RRSP, and the convenience of automatic contributions directly from your paycheque.
  3. Spousal RRSP: A spousal RRSP is an account designed to benefit couples by allowing income splitting during retirement. Contributions made by the higher-earning spouse generates tax deductions, while withdrawals are attributed to the lower-earning spouse, potentially reducing overall tax liabilities.

Each option caters to specific needs and preferences, providing flexibility in aligning your RRSP with your unique financial goals. Consulting with a financial advisor can further guide you in making an informed choice tailored to your circumstances.

Additionally, it’s worth exploring other tax-advantaged accounts like Tax-Free Savings Accounts (TFSA). TFSAs prove advantageous, particularly for those with income taxed at lower rates or those who are anticipating increased income in the future.

Elder Financial Abuse – Recognize it and prevent it

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June 15 is World Elder Abuse Awareness Day and the Alberta Securities Commission (ASC) is encouraging Albertans to be aware of the signs of elder financial abuse.

Elder abuse can manifest in various forms, including physical, emotional, neglect, and financial mistreatment. In Canada, financial abuse is the most prevalent type, often occurring following a crisis, the loss of a loved one, or a decline in physical or mental health, when individuals may be feeling vulnerable and isolated. Unfortunately, identifying financial abuse can be challenging. Financial abuse is often a pattern, rather than a single event, and may happen over a long period of time. It involves the illegal or unauthorized use of someone else’s money or property, which can range from forceful acts like theft or fraud to more subtle forms of pressure or deception. Victims of financial abuse, particularly when it involves friends or family members, may be reluctant to acknowledge or report the abuse, resulting in the abuse going unidentified.

Recognizing Warning Signs of Elder Financial Abuse

Being aware of the warning signs can help loved ones identify potential cases of elder financial abuse. Some signs that a senior may be experiencing financial exploitation include:

  • Unusual financial activity that does not align with their capabilities, such as online banking despite being unfamiliar with computers or making frequent ATM withdrawals despite mobility limitations.
  • Sudden liquidation of investments without a reasonable explanation.
  • Difficulty in contacting the person responsible for managing their finances.
  • Abrupt changes in living arrangements without apparent cause.
  • Emergence of a new close relationship, including romantic involvement, or a sudden shift in emotions towards a person or group.
  • Overly keen interest or involvement in the senior’s financial matters by a friend, family member, or caregiver.
  • Unwillingness to discuss financial matters or an unusual preoccupation with winning lotteries or sweepstakes.

Ways Seniors can Safeguard Their Finances:

Seniors can take proactive steps to protect themselves from financial abuse and support their well-being:

  • Foster social connections: Develop a network of trusted friends and relatives with whom you can openly discuss relationships and financial matters. If you feel someone is intruding excessively, pressuring you, or seeking unwarranted access to your finances, seek support from your trusted network.
  • Stay informed: Thoroughly research investment opportunities or sales pitches before entrusting your money to anyone. Consider consulting a registered financial advisor if you require assistance in managing your finances.
  • Monitor investments: Review financial statements or reports regularly. In case of any unfamiliar account activity, don’t hesitate to ask questions and seek clarification.
  • Appoint a Trusted Contact Person: Consider appointing a Trusted Contact Person. A Trusted Contact Person is someone you’ve given your financial advisor or firm permission to contact should the advisor suspect financial abuse or detect signs of cognitive decline.
  • Be cautious about sharing personal information: Exercise caution when asked to provide copies of sensitive information like driver’s licenses, social insurance numbers, or credit card details. Understand why the information is necessary and how it will be used.
  • Don’t allow anyone to remotely access/control your computer or phone: Be vigilant about protecting your computer or mobile phone from remote access. Be wary of any person trying to persuade you to download a program for your computer or install an app on your phone.
  • Educate yourself about investment scams: visit our Types of investment scams page or reach out to the ASC for information on common investment scams and strategies to avoid them.
  • Understand affinity fraud risks: Even if a close friend or family member recommends an investment opportunity, conduct independent research and don’t succumb to pressure to make immediate decisions.

 

For help or more information on elder financial abuse visit albertaelderabuse.ca

Naming a Trusted Contact Person: Why it Matters

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As we age, we may experience a decline in health or cognitive capacity that could result in difficulty making financial decisions independently. Unfortunately, relying on the help of family members, caregivers and friends can increase the risk of financial exploitation and fraud. One way to safeguard against potential future financial harm is by naming a Trusted Contact Person (TCP).

Who is a Trusted Contact Person?

If you invest with a financial institution or investment firm, your advisor is required to ask you about providing a Trusted Contact Person (TCP). The decision to name a TCP is optional and it’s your choice if you would like to name someone. Providing your advisor with consent to contact your TCP is similar to providing them with an emergency contact. Depending on the consent you provide, your advisor could contact your TCP in the following circumstances:

  • You cannot be reached after repeated attempts and where failure to contact you would be unusual
  • The advisor has concerns you are being financially exploited
  • The advisor has concerns about mental capacity as it relates to your ability to make financial decisions
  • Your advisor needs confirmation of your legal representative (e.g. power of attorney, executor, trustee)

For example, your advisor may contact your TCP when they cannot reach you because you have taken an extended vacation and forgot to inform them. Or, in more sensitive situations, your advisor may contact your TCP to ensure the validity of a request that they believe is out of character.

What can and can’t my Trusted Contact Person do?

A TCP’s sole purpose is to help safeguard your financial assets by being an additional resource to help your advisor make decisions that best protect your account. Your advisor might contact your TCP to discuss:

  • Concerns about your mental capacity and ability to make financial decisions
  • Signs of financial mistreatment or abuse they’ve observed
  • Concerns that you are being scammed

Your TCP is different than a power of attorney. A TCP is not permitted to manage your finances or make financial decisions on your behalf.

Who should be your Trusted Contact Person?

A TCP should be a mature family member or friend who you trust, and you should feel comfortable that they can handle difficult conversations about your personal situation if they arise. Consider choosing someone you know will protect your interests, is familiar with your support network, and is not typically involved in your financial decisions. You should also ensure the person you select agrees to take on the role and is comfortable talking to your advisor.

While naming a TCP on your account is optional and not a legal process, it can provide you valuable peace of mind knowing that your advisor has someone you trust to help safeguard your financial assets now and in the future.

To learn more about assigning a TCP to your accounts, please visit our Investing as you age page or speak to your registered advisor.

A trusted contact person: Enhancing your financial protection as you age

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For those that invest with a financial institution or firm, you now have the ability to provide your registered advisor with a contact person that you trust. This person can play an important role in protecting your financial assets in certain circumstances.

As of December 31, 2021, advisors are required to take reasonable steps to obtain the name of someone you would like to have as your Trusted Contact Person (TCP), should they suspect you are experiencing financial exploitation or diminished mental capacity.

What is a Trusted Contact Person?

As you age, you may experience a decline in your health and cognitive abilities due to medical issues, pre-existing conditions or the natural aging process. In these circumstances, you may become more reliant on others in making financial decisions, potentially exposing you to financial abuse and fraud by those who do not have your best interests at heart.

To help safeguard potentially vulnerable clients from financial abuse and exploitation, the Canadian Securities Administrators, of which the Alberta Securities Commission is a member, introduced the TCP. A TCP is someone you can have listed on your account informing your advisor of who you trust and who they can contact in limited circumstances. This could include:

  • If you are unable to be reached
  • If your advisor has concerns you are vulnerable and being financially exploited
  • If you are having a health issue and your advisor needs to confirm your wellbeing
  • If your advisor needs confirmation of your legal representative

For example, your advisor may contact your TCP when they cannot reach you because you have taken an extended vacation and forgot to inform them. Or, in more sensitive situations, your advisor may contact your TCP to ensure the validity of a request that they believe is out of character.

What can and can’t my Trusted Contact Person do?

A TCP’s sole purpose is to help safeguard your financial assets by being an additional resource to help your advisor make decisions that best protect your account. Your TCP:

  • cannot authorize transactions on your behalf
  • cannot make decisions on your behalf
  • will not be given access to your detailed account information

Who should be your Trusted Contact Person?

A TCP should be a mature family member or friend who you trust, and you should feel comfortable that they can handle difficult conversations about your personal situation if they arise. Consider choosing someone you know will protect your interests, is familiar with your support network, and is not typically involved in your financial decisions. You should also ensure the person you select agrees to take on the role and is comfortable talking to your advisor.

In recognition of June Senior’s Month and World Elder Abuse Awareness Day (June 15), the Alberta Securities Commission (ASC) reminds older Albertans to work with your advisor to put a TCP in place. In a recent study conducted by the ASC, nearly 60% of Albertans aged 65 and over were approached with what they felt was a possibly fraudulent investment. While naming a TCP on your account is optional and not a legal process, it can provide you valuable peace of mind knowing that your advisor has someone you trust to help safeguard your financial assets now and in the future.

Four reasons to consider opening or contributing to your RRSP or Group RRSP

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March 1, 2022 marks the deadline for Albertans to contribute to a Registered Retirement Savings Plan (RRSP) for the 2021 tax year. RRSPs are a retirement savings vehicle that allows you to put away up to 18% of your last year’s income and any carry forward room from prior years. The real benefit is that you defer tax on the amount you contribute, until you withdraw the funds in retirement. If you don’t yet have an RRSP account or feel you have underutilized your existing plan or Group RRSP through your employer, here are four reasons to reconsider and contribute to an RRSP consistently.

1. RRSPs are not just for saving

A common misconception is that RRSPs are just glorified savings accounts. While it may say “savings” in the name, you can also invest in an RRSP and rely on the compound growth of your investments within the plan. RRSPs also discourage you from withdrawing your funds until retirement, which maximizes the compound interest you can generate. RRSPs do this by charging both income tax and a withdrawal tax on any funds removed prior to retirement, and permanently removing contribution room in the amount you take out before age 71. For example, if you invested $100 a month at age 35 into your RRSP in an investment fund that generated an annual 6% return and did not touch it till maturity, you could expect your plan to be worth nearly $143,000.

2. Tax-deferred growth

One of the most significant benefits of the RRSP is that any contributions made to your plan in your working years are deducted from your taxable income and, if invested, can grow tax-free while the funds stay in the account. The longer the time horizon before you retire, the more time you have for compound growth to accelerate and grow your retirement nest egg. Once in retirement, withdrawals from your RRSP will be taxed at your retirement income bracket, which should be less than in your working years.

3. Lifelong Learners Plan (LLP) and the Home Buyer’s Plan (HBP)

RRSPs are generally restricted to retirement savings, but they do include unique benefits to help you pay for significant expenditures in your life, like going back to school or buying a first home. The LLP allows you to withdraw up to $10,000 in a calendar year from your RRSP to finance full-time training or education for you or your spouse or common-law partner. Once withdrawn, you have to make annual payments to your RRSP over a ten-year period until the balance is zero. The HBP allows you to withdraw up to $35,000 from your RRSP to buy or build a qualifying home for yourself or a related person with a disability. The repayment period starts the second year after the year you withdrew the funds, with 15 years to repay the funds in your RRSP. It is worth noting that if you fail to repay the funds from either plan in the allotted time, you will lose that contribution room from your RRSP and any missed annual payments will be added to your annual taxable income.

4. Group RRSPS

A Group RRSP is administered by employers as part of its compensation package to employees and can be a powerful savings vehicle for your retirement. One of the biggest benefits of a group RRSP is contribution matching. Employers will define a contribution level as either a fixed dollar amount or a percentage deducted from the employee’s paycheque automatically each pay period. Whatever amount the employee chooses to allocate to the Group RRSP, the employer will match the contribution, effectively doubling the savings rate for the employee. Funds contributed to a group RRSP are invested in securities offered by the financial institution administering the Group RRSP. Most Group RRSP providers offer a selection of funds for varying retirement dates, asset allocations and risk tolerances. If you do not utilize a Group RRSP from your employer or do not contribute the total amount allowed, you may be leaving a significant amount of money out of your possible retirement savings.

With tax time nearing, consider the benefits of opening or contributing more routinely to an RRSP or Group RRSP. Not only will you defer some of your income tax payments throughout your working years, but you will also be creating a nest egg that your future self will appreciate.

Investment fraud prevention: Tips for staying safe in a post-pandemic world

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Over the past year Albertans of all ages experienced social isolation and felt the effects of loneliness. The good news is that with the creation and widespread distribution of vaccines, we should soon be able to reconnect in person with loved ones and friends. As we move towards these opportunities to reconnect, it is important to be mindful of the connections we re-establish and the new friendships we make.

As they always do with global events and trends, fraudsters capitalized on the pandemic to attempt to sell their investment scams (often related to the fight against COVID-19). They marketed their scams heavily through email, social media and online forums like Facebook groups in lieu of in-person interactions. These digital avenues will continue to be popular, but with the eventual reopening of in-person activities, fraudsters will again try to prey on the perceived vulnerability of seniors.

In a recent study conducted by the ASC, 54% of Albertans aged 45-64 believed they had been approached with a potentially fraudulent investment opportunity. By understanding the tell-tale signs of fraud and remembering the fundamental principles to making wise financial decisions, older Albertans and their caregivers can recognize, avoid and report investment fraud and financial abuse. Remember the following tips to safeguard your retirement savings or those of someone you care about.

Leveraging fears or anxieties: A go-to tactic of every scam artist is tapping into the financial stressors their targets may have. This could include having enough for retirement, leaving a legacy for loved ones or the fear of missing out on great investments as the economy reopens. Regardless, keep an eye out for anyone trying to tap into your fears or anxieties when offering an investment and do not share your personal financial information with new acquaintances.

New friends taking an immediate interest in your financial wellbeing: As we start to reconnect with friends and family and make new friendships, be wary of any new person in your life who takes an immediate interest in your finances. Fraudsters do this to establish trust, learn the fears or anxieties you may have, understand how much they can steal and how to manipulate you. Be sure to create boundaries for your personal finances and private matters.

Investment offers from unregistered individuals: By law, anyone selling investments in Alberta should generally be registered with the Alberta Securities Commission (ASC). You can check by visiting CheckFirst.ca or by contacting the ASC. If the investment offer comes to you from a friend, inquire where it originated from and ensure the individual or firm that offered it to your friend is registered. Contact the ASC if you suspect it may be a fraudulent investment or need assistance in confirming registration.

Exclusive offers: Investments promoted as exclusive offers just to you is a clear red flag of fraud. Fraudsters utilize this tactic to drive false urgency and prevent you from researching and talking to others about the investment. Investments will always be available, and no credible financial advisor should ever rush you to a decision.

The reopening of Alberta is an exciting time for everyone, but remember that bad actors will look for ways to use in-person opportunities and friendships to promote their scams. By staying mindful of these tips, older Albertans and those who care for them can enjoy making up for lost time and avoid fraud.

If you feel you or someone you care for may be involved in an investment scam, do not let the embarrassment or fear keep you from speaking up. You can contact or file a complaint with the ASC at www.albertasecurities.com or call us toll-free at 1-877-355-4488.

 

Connecting with the seniors in your life about investment fraud

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Current pandemic measures have dramatically changed how we interact with our friends and family. While physical distancing affects everyone, seniors are experiencing increased isolation and loneliness as friends and family are unable to visit in person.

Unfortunately, fraudsters see this as a prime opportunity to become a “trusted” friend in a senior’s life so they can take advantage of them or their retirement nest egg through fraudulent scams or unsuitable investments. Scammers use a variety of methods to target seniors, including emails, mail, phone calls and even in-home visits.

The danger of financial abuse is real. In a 2020 study conducted by the Alberta Securities Commission one third of Albertans 55-plus believe they’ve been approached with a potentially fraudulent investment scam through a co-worker, family member, friend or even a member from a club, group or organization they belong to.

Fraudsters use a variety of tactics to defraud seniors, including:

  • Leveraging their trust and politeness to establish friendships quickly.
  • Instilling fear that they will run out of money in retirement and burden their family.
  • Exploiting current events like the pandemic to offer fake investments in cures and new technologies.
  • Using high-pressure sales tactics.
  • Promising high returns with little or no risk and exclusive opportunities.
  • Unsolicited investment opportunities and friend requests through Facebook and social media.

How can you help protect seniors in your life from investment fraud?

You can help protect your friends and family from investment fraud with open communication about their daily lives and financial decisions. Calling them routinely can help reduce social isolation and disrupt any suspicious activity that might be happening. If you believe someone you know might be at risk, be proactive and do the following:

  • Bring up the topic of investment fraud. Share the dangers of investment fraud during this time and send them information specifically created for seniors.
  • Listen and be engaged. Be open to discussing issues or topics regarding their finances and help them check the registration and history of any individual or firm offering them an investment opportunity.
  • Pay attention to their social circles. Have they been mentioning a new friend or someone who has started providing them advice, financial or otherwise? Ask questions respectfully and monitor any ongoing suspicious activities.

 

If you suspect you or someone in your life may be involved in a potentially fraudulent investment scheme find help and more information at checkfirst.ca.

 

 

 

Scams exploiting fears and isolation of older Albertans amid COVID-19

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The COVID-19 pandemic has impacted lives around the world, including families across Alberta and especially seniors, who are isolated from support groups. The recent volatility of the markets, coupled with potentially lost retirement savings and social isolation, has created an environment of fear, uncertainty and vulnerability. Unfortunately, this is exactly the environment that scam artists prey upon.

As COVID-19 continues to spread, associated scams are emerging as scam artists exploit the crisis to profit from people’s fears, uncertainties and misinformation.

There are many types of fraud popping up during COVID-19. One example includes phishing and malware scams where scammers pose as governmental agencies, national or global health authorities, and send phishing emails or texts designed to trick people into downloading malware or providing personal identification and financial information. They can appear to be real, but err on the side of caution and think carefully before providing anyone with this information.

Another common scam are pump-and-dump schemes involving publicly traded small “shell” companies. Scam artists will ‘pump’ up the company’s value by enticing investors to purchase stock with inflated or false claims, then quickly ‘dump’ their stock before the hype ends. This results in a substantial payout for the scam artist while all the remaining investors lose their money. Often pump-and-dump schemes can be related to companies claiming to have products or services that will prevent, detect or cure COVID-19 infection. Be cautious of any claims that a company has a solution to help stop the coronavirus outbreak.

There are multiple ways that scam artists will target an individual. According to a 2020 study conducted by the Alberta Securities Commission (ASC), some of the most common ways Albertans 55+ years of age believed they were approached with a potentially fraudulent investment scam were:

  • Through a friend, neighbour, co-worker or family member, or from a member of a club, group or organization they belong to (32%)
  • By a stranger calling over the telephone (22%)
  • From email spam (23%)

When considering investing in any opportunity, always read the fine print and research the investment – no matter how the opportunity was presented to you. Keep in mind that fraudsters often exploit the latest crisis with the COVID-19 outbreak being no different. Don’t be lured in by promises of easy returns – more likely you’ll be asked for money upfront that you’ll never see again. Also remember that anyone selling investments needs to be registered with provincial securities regulators to do so. For more information on how to recognize and avoid these scams and to check the registration of any individual or firm offering you an investment opportunity, visit the Alberta Securities Commission’s website: Checkfirst.ca.