Financial abuse is on the rise. Criminals are finding new and innovative ways to take advantage of people, particularly through social media and the internet. Always be on the lookout for financial abuse and take precautions to protect yourself. Here are a few things to consider:
- Anyone can fall victim to a scam. Understand that many of these criminals are very sophisticated. Individuals sometimes feel embarrassed talking to their family or advisors about possible financial abuse, because they feel stupid for letting it happen in the first place. Keep in mind that many intelligent people have been the victims of financial abuse, so there is nothing to be embarrassed about.
- Abusers will try to isolate their victims. One of the main tactics abusers use is to isolate their victims and convince them that they can’t tell anyone what is going on. There have been many cases where financial institutions questioned transactions that the client was requesting, and the client lied to their financial advisor at the instruction of the abuser. If anyone tells you to lie to your financial advisors or your family about how you are spending your money, that is a red flag that it is probably a scam. The reason they don’t want you to talk to your advisor about it is because the abuser knows that a third party may be capable of identifying their actions as criminal in nature.
- Abusers will apply pressure and use other bullying tactics. Quite a few financial abuse scams involve pressure tactics and bullying. Reach out to your family, your advisors, seniors’ advocates or law enforcement. Share the correspondence you have received from the abuser with your financial advisor, as they may be able to determine if it is a scam. Seniors advocate groups, law enforcement organizations, the Canada Revenue Agency and other government authorities have all sorts of information on their websites describing various scams and how they work, so your advisors may be able to identify the scam based on the information you send them. The Government of Canada has created a “Little Black Book of Scams” that provides details about many of the most common types of fraud. Once you know you’re dealing with a criminal, that will give you more confidence to tell them to go away and you should feel less threatened by them because you will know that their threats have no merit.
- Be wary of the new online romantic partner. Quite a bit of financial abuse is conducted through “romantic scams”, so be very wary of any social media friends whom you’ve never met in person – no one you’ve never met should be asking you for money or personal financial details.
- Be wary of the unknown inheritance or pay-day. There are also a number of “inheritance scams”, where con artists ask you for money or financial information under the guise of needing it to confirm if you are a long lost beneficiary under a will they’ve found – if you actually are a beneficiary, you shouldn’t need to be providing money or financial information. If anyone asks you for this information, you should speak to your IG Consultant first to make sure that it is legitimate.
- Consider whom to grant power of attorney (or protection mandate in Quebec) very carefully. If you don’t have any family members whom you feel are appropriate for the job, ask your IG Consultant to recommend a trust company that provides attorney services. Paying a fee for these services will be small in comparison to the potential losses you could experience if your attorney or mandatary takes advantage of their situation to steal from you. In some cases these individuals are well-meaning, but simply don’t have the education required to act in the role. Don’t choose someone simply because you can’t think of an alternative.
- Seek professional advice before making changes to your accounts or assets. Don’t add your child or anyone else as a joint owner of your investment accounts without first speaking to your IG Consultant. Generally speaking, adding a joint owner is not recommended and could lead to financial abuse if the joint owner takes advantage of the situation.
If you think something is suspicious, the first thing you should do is speak to your family, your IG Consultant, or the police. The worst thing that will happen is that they will tell you there is nothing to worry about. Trust your instincts – if you have any concerns about someone in your life who is pressuring you, reach out for help.