Senior is targeted by fraudulent investment firms

At OBSI, we have seen a significant increase in complaints related to cryptocurrency and fraud. The case example below was originally published in our Consumer Bulletin: Cryptocurrency scams increasingly targeting and exploiting Canadians.

Bank warns of potential scam

Ms. P was a senior eager to invest and increase her retirement savings. Unexpectedly, she received phone calls from two different investment firms. Both firms encouraged her to invest in cryptocurrency and promised high returns. Ms. P thought she had found a new and lucrative investment opportunity and asked the firms how she could start investing. The firms explained that her account needed to be financed with bitcoin if she wanted to move forward with the investment opportunity. Ms. P asked her bank to send several e-transfers that totalled $1,300 from her personal line of credit to four cryptocurrency dealers, so she could buy bitcoin.

Prior to granting Ms. P’s e-transfer request, her bank asked her if she knew the people to whom she was sending money and warned that it could be a scam. In response, Ms. P confirmed that she knew the account manager and insisted that the bank had no right to stop her from investing her own money. Following Ms. P’s instruction, the bank sent the e-transfers to the cryptocurrency dealers, and the equivalent in bitcoin was delivered to her.

Shortly afterwards, the investment firms showed Ms. P charts to indicate that her investments were profitable and recommended that she invest more. When Ms. P withdrew $30,000 from her personal line of credit about four weeks later, the bank cautioned her and provided her with a fraud prevention document to increase her awareness of potential fraud. Despite the bank’s attempt to flag the possibility of fraud, Ms. P authorized multiple e-transfers to send the $30,000 to multiple cryptocurrency dealers to buy more bitcoin. Once again, she transferred the equivalent in bitcoin to the two investment firms.  Ms. P continued to withdraw additional money from her personal line of credit to finance her bitcoin investment accounts. After six months, she had invested a total of $52,600.

The investment firms assured Ms. P that her investments were profitable, and she was eager to access the profits. She contacted both firms to withdraw her funds. However, neither firm would release them. After her withdrawal request, they also stopped responding to her calls and emails. Ms. P realized that she had been scammed by both firms. She lost all of the money that she had sent to the scammers. 

(2022)