Annual Statistical Report 2014


Mass Marketing Fraud & ID Theft Activities

Table of Contents

Introduction

OVERALL MASS MARKETING FRAUD

MASS MARKETING FRAUD AND CANADA

CANADIAN IDENTITY FRAUD

PROMINENT MMF SCAMS AND DEFINITIONS

Canadian Anti‐Fraud Centre Annual Statistical Report

Established in January of 1993, the Canadian Anti‐Fraud Centre (CAFC) is a partnership between the Royal Canadian Mounted Police (RCMP), the Competition Bureau of Canada and the Ontario Provincial Police (OPP). The CAFC is Canada's central repository for data, intelligence and resource material as it relates to fraud. The CAFC commits to providing timely, accurate and useful information to assist citizens, businesses, law enforcement and governments in Canada and around the world. The primary goals are prevention through education and awareness, disruption of criminal activities, providing assistance with regard to enforcement, and strengthening partnerships between the private and public sectors with the aim of maintaining Canada's strong economic integrity.

This report presents statistics that provide a snapshot of mass marketing fraud activities that transit Canada or originate in Canada or that affect Canadians.

Statistics presented in this report are based on what has been captured by the CAFC at a given point in time and are subject to change resulting from inputting back log complaints and database cleaning.

In an effort to develop a greater understanding of Identity Fraud, this report presents the figures on Identity Fraud separately from the other MMF scams.

Executive Summary

This report presents statistics on Canadian based MMF operations targeting both Canadian and international victims as well as Canadians as victims of international based scams and Canadian Identity Theft victims reported to the CAFC.

The CAFC saw a decrease in the total number of MMF complaints received in 2014; however the total number of victims and MMF reported dollar loss has increased.

Total number of complaints by Canadian complainants on Canadian based MMF has decreased; however the total number of victims and reported dollar loss has increased.

Total number of complaints, victims and dollar loss by US and International complainants on Canadian based MMF has decreased.

Ontario consumers were most targeted by MMF operations based on total number of complaints; however Quebec reported the highest total dollar loss.

Based on complaints received at the CAFC, Ontario is identified as the principle base of Canadian based MMF operations.

Based on total number of complaints, “Service” is the top reported MMF scheme type reported by Canadian consumers.

Based on total number of complaints, “Emergency” is the top reported Canadian based MMF scheme type reported by US consumers.

Based on total number of complaints “Telephone / Facsimile” is reported as the most prevalent solicitation method used to solicit Canadian consumers; however Canadian victims of an “E-mail / Internet” solicitation method have the highest total reported dollar loss.

Based on the total number of complaints, Canadians between the ages of 60-69 are the most targeted by MMF operations. Canadian victims between the ages of 50-59 reported the highest dollar loss.

Based on complaints received at the CAFC, Toronto is identified as the principle base of Canadian based MMF operations.

Money Service Businesses is the top reported payment method used to send funds from Canadian victims.

The number of Canadian Identity Fraud victims has increased, however the total reported dollar loss has decreased.

Overall Mass Marketing Fraud

The following graph presents a breakdown of the total number of MMF complaints reported to CAFC and the number of those that were classified as victims. Description of graph in tabular format follows.

MMF Complaint Breakdown

MMF Complaint Breakdown
Year Total Number of Complaints Number of Victims
2012 42,595 15,202
2013 47,135 15,056
2014 42,200 14,472

Total reported dollar loss reported to the CAFC by MMF victims is presented in the graph below. Description of graph in tabular format follows.

MMF Total Reported Dollar Loss

MMF Total Reported Dollar Loss
Year Reported Dollar Loss
2012 $68,691,509.46
2013 $59,904,149.26
2014 $74,387,465.23
Mass Marketing Fraud and Canada

MMF operation locations are based on suspect addresses reported by consumers. Thus, it must be noted that in some cases, reported addresses may be mail drops and not the physical location of a MMF operation, or the suspect location identified may be false.

The following graph presents a breakdown of Canadian complaints on MMF operations by total number of complaints, the total that were classified as victim reports and the total reported dollar loss. Description of graph in tabular format follows.

Canadian Complaints on MMF

Canadian Complaints on MMF
Year Total Number of Complaints Number of Victims Total Reported Dollar Loss
2012 39,346 13,172 $55,344,359.32
2013 44,355 12,954 $53,690,220.65
2014 41,019 13,701 $69,481,724.77

The following graph presents a breakdown of Canadian complaints on Canadian based MMF operations by total number of complaints, the total that were classified as victim reports and the total reported dollar loss. Description of graph in tabular format follows.

Canadian Complaints on Canadian Based MMF

Canadian Complaints on Canadian Based MMF
Year Total Number of Complaints Number of Victims Total Reported Dollar Loss
2012 8,503 2,645 $14,064,735.24
2013 9,544 2,613 $9,775,151.79
2014 7,840 2,477 $11,751,579.54

The following graph identifies the total number of complaints received from US consumers on Canadian based MMF and the total that were classified as victim reports. Description of graph in tabular format follows.

United States Complaints against Canadian Based MMF

United States Complaints against Canadian Based MMF
Year Total Number of Complaints Number of Victims
2012 1,131 752
2013 650 449
2014 390 293

The following graph identifies the total number of international complaints received and the number of those that were victims of Canadian based MMF. Description of graph in tabular format follows.

International Complaints against Canadian Based MMF

International Complaints against Canadian Based MMF
Year Total Number of Complaints Number of Victims
2012 1,241 844
2013 716 494
2014 468 359

The following graph presents the total reported dollar loss by US victims on Canadian based MMF operations. Description of graph in tabular format follows.

Total Reported Dollar Loss by US Victims to Canadian Based MMF

Total Reported Dollar Loss by US Victims to Canadian Based MMF
Year Total Reported Dollar Loss
2012 $3,962,493.80
2013 $1,726,345.96
2014 $1,431,997.98

The graph below presents the total reported dollar loss reported by international victims on Canadian based MMF. Description of graph in tabular format follows.

Total Reported Dollar Loss by International Complaints to Canadian Based MMF

Total Reported Dollar Loss by International Complaints to Canadian Based MMF
Year Total Reported Dollar Loss
2012 $6,021,077.26
2013 $2,168,396.47
2014 $1,825,711.79

The following graph presents a provincial breakdown of Canadians targeted by MMF based on the total number of complaints and the total that were classified as victim reports. Description of graph in tabular format follows.

Provincial Breakdown for Canadian MMF Complainants

Provincial Breakdown for Canadian MMF Complainants - 2014
Province Total Number of Complaints Number of Victims
AB 4,579 1,604
BC 4,622 1,422
MB 1,898 610
NB 1,194 316
NL 503 140
NS 1,103 276
NT 68 27
NU 9 2
ON 16,922 5,386
PE 136 28
QC 8,076 3,245
SK 1,093 371
YT 55 22

The following graph identifies principal bases of Canadian based MMF operations based on reported suspect locations. Description of graph in tabular format follows.

Provincial Breakdown by Canadian Suspect Location

Provincial Breakdown by Canadian Suspect Location - 2014
Province Total Number of Complaints Number of Victims
AB 467 174
BC 634 222
MB 160 43
NB 59 21
NL 28 4
NS 84 23
NT 4 2
NU 0 0
ON 3,169 1,241
PE 9 2
QC 1,239 568
SK 69 28
YT 25 10

The following graph identifies the provinces that were most targeted by international MMF schemes based on the total number of complainants and the total that were classified as victim reports. Description of graph in tabular format follows.

Provincial Breakdown: Canadian Complainants Targeted by International MMF

Provincial Breakdown: Canadian Complainants Targeted by International MMF - 2014
Province Total Number of Complaints Number of Victims
AB 1,238 615
BC 993 401
MB 410 156
NB 256 92
NL 93 45
NS 230 79
NT 18 4
NU 2 1
ON 4,002 1,787
PE 23 7
QC 2,340 1,173
SK 279 114
YT 16 7

The graph below identifies the top five MMF schemes reported by Canadian complainants which accounts for 55% of the reported complaints.  The remaining 45% represents other MMF schemes which individually account for less than 6% of the total number of complaints. Description of graph in tabular format follows.

Top 5 MMF Schemes Reported by Canadian Complainants

Top 5 MMF Schemes Reported by Canadian Complainants - 2014
All Other Reported MMF Schemes 45%
Service 21%
Prize 11%
Extortion 9%
Merchandise 8%
Phishing 6%

The graph below identifies the top five reported Canadian based MMF schemes targeting Canadians which accounts for 51% of the reported complaints. The remaining 49% represents other MMF schemes which individually account for less than 7% of the total number of complaints. Description of graph in tabular format follows.

Top 5 Reported International MMF Schemes

Top 5 Reported International MMF Schemes Targeting Canadians - 2014
All Other Reported MMF Schemes 49%
Service 17%
Extortion 10%
Job 9%
Prize 8%
Merchandise 7%

The following graph identifies the top five Canadian based MMF schemes reported by US complainants which accounts for 75% of the reported complaints. The remaining 25% represents other MMF schemes which individually account for less than 11% of the total number of complaints. Description of graph in tabular format follows.

Top 5 Canadian Based MMF Schemes Reported by US Complainants

Top 5 Canadian Based MMF Schemes Reported by US Complainants - 2014
All Other Reported MMF Schemes 25%
Emergency 19%
Prize 17%
Loan 15%
Sale of Merchandise by Complainant 13%
Merchandise 11%

The top five reported international schemes reported by Canadians is presented in the graph below, which account for 59% of the reported complaints. The remaining 41% represents other MMF schemes which individually account for less than 9% of the total number of complaints. Description of graph in tabular format follows.

Top 5 Reported International MMF Schemes

Top 5 Reported International MMF Schemes Targeting Canadians - 2014
All Other Reported MMF Schemes 41%
Prize 15%
Service 14%
Merchandise 11%
Foreign Money Offers 10%
Sale of Merchandise by Complainant 9%

The following graph presents a provincial breakdown on the total reported dollar loss by Canadian complainants targeted by MMF. Description of graph in tabular format follows.

Total Reported Dollar Loss for Canadian MMF Complainants

Total Reported Dollar Loss for Canadian MMF Complainants - 2014
Quebec $26,995,529.51
Ontario $22,064,177.16
Alberta $7,271,685.92
British Columbia $5,610,527.01
Manitoba $3,803,313.16
Saskatchewan $1,493,999.84
PEI $492,084.88
Nova Scotia $428,326.50
New Brunswick $407,478.08
Yukon $131,203.46
Newfoundland & Labrador $105,248.30
NWT $18,857.31
Nunavut $6,233.53

A provincial breakdown on the total reported dollar loss by Canadian complainants targeted by international based MMF schemes is presented in the graph below. Description of graph in tabular format follows.

Total Reported Dollar Loss for Canadian Complainants Targeted by International MMF Schemes

Total Reported Dollar Loss for Canadian Complainants Targeted by International MMF Schemes - 2014
Quebec $17,996,456.48
Ontario $8,754,514.68
Alberta $2,979,124.18
British Columbia $2,892,964.84
Manitoba $1,019,496.07
Saskatchewan $908,466.28
Prince Edward Island $482,574.97
Nova Scotia $257,148.41
New Brunswick $176,337.66
Newfoundland & Labrador $42,724.50
Yukon $32,626.56
Nunavut $763.17
Northwest Territories $682.47

The graph below presents the top reported Canadian based MMF operation locales based on total reported dollar loss. Description of graph in tabular format follows.

Total Reported Dollar Loss by Canadian Suspect Location

Total Reported Dollar Loss by Canadian Suspect Location - 2014
Ontario $6,167,310.50
Quebec $4,268,687.26
British Columbia $1,074,502.98
Alberta $1,047,310.27
Nova Scotia $114,948.48
Manitoba $90,419.71
Prince Edward Island $70,000.00
New Brunswick $53,660.00
Newfoundland & Labrador $50,583.84
Yukon $31,820.00
Saskatchewan $31,456.55
Northwest Territories $1,424.99
Nunavut $0.00

The following graph presents an age breakdown of Canadian complainants based on the total number of complaints and the total that were classified as victim reports. Description of graph in tabular format follows.

Canadian Complainant Age Range

Canadian Complainant Age Range - 2014
Age Range Total Number of Complaints Number of Victims
1 - 9 0 0
10's 397 186
20's 2,947 1,297
30's 4,204 1,486
40's 5,230 1,690
50's 6,913 2,083
60's 7,524 2,142
70's 4,646 1,313
80's 2,007 668
90's 266 72
100 + 2 0
Business 2,384 555
Deceased 83 46
Unknown 3,741 2,048

The graph below presents an age breakdown on the total reported dollar loss reported by Canadian MMF victims.

"Business" denotes a complaint filed by a company. "Deceased" are complaints that were filed by friends or family members of the deceased complainant after becoming aware of the fraud. "Unknown" is where CAFC was not given the age or date of birth of the victim upon receiving the complaint. Description of graph in tabular format follows.

Total Reported Dollar Loss by Canadian Complainant

Total Reported Dollar Loss by Canadian Complainant Age Range - 2014
Age Range Total Reported Dollar Loss
1 - 9 $0.00
10's $95,001.58
20's $1,249,304.68
30's $2,955,071.14
40's $5,704,480.31
50's $9,771,726.81
60's $8,306,252.15
70's $5,757,819.29
80's $2,974,475.51
90's $201,342.31
100 - 109 $0.00
Business $26,005,760.24
Deceased $603,862.77
Unknown $5,347,870.19

The graph below identifies MMF solicitation methods used to solicit Canadian consumers based on the total number of complaints and the total that were classified as victim reports. Description of graph in tabular format follows.

Suspect Solicitation Method Reported by Canadian Complainants

Suspect Solicitation Method Reported by Canadian Complainants - 2014
Method Number of Victims Total Number of Complaints
Media /Print / Radio / Television 31 70
In Person 233 365
Text Messaging 211 792
Other / Unknown 897 1,100
Mail 241 2151
E-mail / Internet 7,334 13,757
Telephone / Facsimile 4,557 22,015

The following graph presents a breakdown on the total reported dollar loss based on the solicitation methods used to solicit Canadian consumers. Description of graph in tabular format follows.

Total Reported Dollar Loss by Suspect Solicitation Method Reported by Canadian Complainants

Total Reported Dollar Loss by Suspect Solicitation Method Reported by Canadian Complainants - 2014
E-mail/ Internet 66%
Telephone / Facsimile 20%
Other / Unknown 5%
In Person 5%
Mail 3%
Media / Print / Radio /Television 1%
Text Messaging 0%

The graph below identifies the top five reported payment methods used to receive funds from Canadian victims.  The payment methods listed below account for 80% of the reported complaints.  The remaining 20% represents other victim payment methods which individually account for less than 2% of the total number of complaints. Description of graph in tabular format follows.

Top 5 Reported Canadian Victim Payment Methods

Top 5 Reported Canadian Victim Payment Methods - 2014
Money Service Businesses 45%
Credit Card 24%
All Other Reported Payment Methods 20%
Wire Transfer 5%
Prepaid Card Transfer 4%
Email Money Transfer 2%

The following graph identifies the top five Canadian city-based MMF suspect locations based on reported suspect location. These five cities account for 44% of the reported complaints. The remaining 56% represents other reported suspect Canadian cities which individually account for less than 3% of the total number of complaints. Description of graph in tabular format follows.

Top 5 Reported Suspect Canadian Cities

Top 5 Reported Suspect Canadian Cities - 2014
All Other Reported Cities 56%
Toronto 19%
Montreal 12%
Ottawa 6%
Vancouver 4%
Mississauga 3%

In 2014 Canadians reported suspect addresses from 132 different countries including Canada.  The following graph identifies the top five reported suspect locales reported by Canadians which account for 75% of the reported complaints. The remaining 25% represents other reported suspect country locals which individually account for less than 3% of the total number of complaints. Description of graph in tabular format follows.

Top 5 Reported Suspect Countries

Top 5 Reported Suspect Countries - 2014
Canada 45%
All Other Reported Countries 25%
United States 19%
Jamaica 5%
Nigeria 3%
United Kingdom 3%
Canadian Identity Fraud

The following graph represents the total reported dollar loss by Canadian Identity Fraud victims and the total number of victims. Description of graph in tabular format follows.

Canadian Identity Fraud

Total Reported Dollar Loss by Canadian Identity Fraud Victims - 2014
Year Total Reported Dollar Loss Number of Victims
2012 $16,069,715.75 17,094
2013 $11,104,001.56 19,489
2014 $10,484,492.50 20,611

Appendix A

Charity/Donation:
Any false, deceptive or misleading solicitation for a donation to a charity, association, federation or religious cause.

Collection Agency:
Any solicitation requesting payment for a non-existent debt. Solicitation requesting that the consumer pay the suspect company who is misrepresenting themselves.

Credit Card:
Any false, deceptive or misleading solicitation in which consumers are offered and pay for a credit card up front but never receive the card.

Directory:
Any sale of specialized directories (hard copies, CD-ROM or Internet) to businesses and non-profit organizations using misleading representations and deceptive sales techniques. Various scenarios are used to lead targeted organizations into believing that contract obligations exist between them and the deceptive telemarketing operations.

Emergency:
Any solicitation from someone claiming to be a friend or family member stating to be in some kind of trouble, usually being arrested, involved in a car accident or trapped in a foreign country and need money immediately for bail, medical fees or a ticket home. This is sometimes referred to as the Grandparent Scam.

Extortion:
Any person who unlawfully obtains money, property or services from a person, entity, or institution, through coercion.

False Billing:
Any consumer who receives a bill or invoice for a service that was not performed or for merchandise that was not ordered.

Foreign Money Offer:
Any solicitation commonly offering or requesting assistance in the transfer of a large sum of money from an international country. The solicitation may also come from a lawyer or some legal entity advising the victim of an inheritance of a sum of money. The victim must pay one or more advance fees before the money can be released. The money or inheritance is fictitious and the victim never receives the money promised. This is sometimes referred to as Nigerian, 419 or West African fraud.

Gems/Precious Metals:
Any advance fee investment in gems and/or precious metals that are often worth very little or they are non-existent.

Grant/Loan:
Any solicitation offering a grant (or the eligibility of a grant) in which a consumer is required to pay a fee for the processing of the grant. The victim does not receive the grant.

Health:
Any false, deceptive or misleading promotion of, or solicitation regarding, health products or services relating to cures or treatments where the claims cannot be substantiated, or where consumers receive bogus products or treatments that do not work as advertised, if at all.

Identity Theft:
Any unauthorized acquisition, possession or trafficking of personal information, or, the unauthorized use of information to create a fictitious identity or to assume/takeover an existing identity in order to obtain financial gain, goods or services, or to conceal criminal activities.

Investment:
Any solicitation for investments into false, deceptive or misleading investment opportunities, often offering higher than normal or true monetary returns in which consumers lose most or all of their money that is supposedly invested.

Job:
Any false, deceptive or misleading solicitation offering employment and requesting an advance fee to secure the job or obtain the materials to perform the job or any job offer involving money transfer or wiring funds related to cashing monetary instruments.

Loan:
Any false, deceptive or misleading solicitation involving the advertisement in a publication such as newspaper, classified ads, magazines or through online ads and websites, offering a loan regardless of consumer's credit history. A victim responds to the ad and is required to send an advance fee in order to receive the loan, but never receives it.

Merchandise:
Any products purchased through classified ads over the Internet or Internet auction sites or through a catalogue or by mail order, and never receiving the items or receiving the product which is of inferior value, quality or it is not what it is supposed to be.

Modem-Hijacking:
Any victim who unknowingly downloads a virus or program that uses the phone line to make long distance calls.

Office Supplies:
Any false, deceptive or misleading solicitation involving assumed sales tactics in which the suspect company misrepresents itself as the victim's usual supplier, often by confirming their address and by pretending to offer the product at a discounted price or on a free trial basis.

Personal Information:
Any solicitation where an individual is asked for or to verify private and personal information.

Phishing:
Any e-mail falsely claiming to be an established legitimate organization such as a financial institution, business or government agency in an attempt to have the consumer surrender private and personal information. The e-mail may request or direct the consumer to visit a web site where they are asked to update or provide personal and/or financial information.

Prize:
Any false, deceptive or misleading solicitation advising victims they have won or have a chance to win something but are required to purchase something first or pay an advance fee, such as taxes to receive the prize.

Pyramid:
Any initial investment into a company's product that is to be sold. The victim is required to sell the product as well a recruit other people to sell the product. In some cases there is no product being bought or sold and the only way to make money is to recruit other investors.

Recovery Pitch:
Any victim of a previous fraud is solicited by an individual claiming to be a law enforcement officer, customs officer, lawyer or any other authority and told that the suspect agency has recovered the money that they lost in the past. In order to get their money back, the victim is told that they must pay an advanced fee.

Romance:
Any individual with false romantic intentions towards a victim and by gaining their affection and trust (sometimes with the promise of marriage) gain access the victim's money, bank account, credit cards or in some cases by getting the victims (usually unknowingly) to commit fraud on their behalf.

Sale of Merchandise by Complainant:
Any incident involving an individual selling merchandise and receiving payment in the form of a counterfeit or altered monetary instrument (e.g. cheque, money order etc.) for more than the asking price. The victim is then directed to cash the cheque and send the extra amount back. Ultimately, the victim is responsible to pay back any funds sent after cashing the cheque and may lose the sold merchandise if it has been shipped.

Service:
Any false, deceptive, or misleading promotion of or solicitations for services. These solicitations involve third parties that commonly make offer for telecommunications, Internet, finance, medical and energy services. Additionally, this category may include but is not limited to offers such as extended warranties, insurance and sales services.

Timeshare:
Any individual paying an upfront fee to advertise their timeshare with a company or paying the advance fee on the promise of a quick sale. In either scenario the service is not provided and the timeshare does not sell.

Unauthorized Account Access:
Any individual that accesses an on-line account (e.g. financial, social etc.) without authorization or prior consent of the account holder.

Unauthorized Charge:
Any consumer's bank account or credit card that is charged for a service or merchandise (which may or may not have been preformed and/or received) that was not authorized by the account holder. It may also occur what a consumer provides credit card or banking information to a company offering a free trial for a product. The company does not disclose the billing terms and/or conditions or does not have such details prominently displayed on their website which can result in repeated billing.

Vacation:
Any false, deceptive or misleading solicitation in which an advance fee is required to secure or hold a vacation. This commonly involves a failure to disclose material information, through the guise of receiving a free gift or reward, designed to convince victims to attend sales presentations where they are subjected to high-pressure sales and/or misleading representations.

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