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Here’s Why Investment Scammers Are Targeting Canada

Fraudsters receive a 10% commission on the amount they manage to steal.
Cover Image Source: Unsplash | Photo by Resume Genius
Cover Image Source: Unsplash | Photo by Resume Genius

Every evening, approximately 150 people walk into a building in Kyiv, Ukraine, unaware of the nefarious activities that take place within. Their sole purpose? To deceive and defraud Canadians of their hard-earned savings through a range of investment scams. This shocking revelation comes from a whistleblower, who, under the pseudonym "Alex," shed light on the inner workings of these fraudulent call centers, per CBC.

Scammers are not sparing anyone in Canada. Image Source: Unsplash|Photo by Sasun Bughdaryan
 Image Source: Unsplash | Photo by Sasun Bughdaryan

According to Alex, the building on Tarasa Shevchenko Boulevard is just one of many similar establishments across Eastern Europe. These call centers operate under the command of about two dozen criminal organizations with a global reach. Their chosen modus operandi involves promising victims high returns on investments, particularly in cryptocurrency schemes.

Cover Image Source: Pexels/Pixabay
Image Source: Pexels | Photo by Pixabay

Canada has become a prime target due to a lack of robust enforcement against such scams. Despite warnings from financial authorities, the absence of significant prosecutions sends a message to scammers that the nation is an easy target. Statistics from the Canadian Anti-Fraud Centre (CAFC) corroborate this concern, revealing that over $300 million was stolen from Canadians in investment scams in 2023 alone. Shockingly, only a fraction of victims report their losses to authorities, allowing these criminal enterprises to operate with relative impunity.

Woman Loses More Than $7,000 to Investment Scam Seen on TikTok. Pexels | By Andrea Piacquadio
Image Source: Pexels | Photo by Andrea Piacquadio

The scam typically begins with enticing social media ads featuring fake endorsements from prominent Canadians like Prime Minister Justin Trudeau or business magnate Kevin O'Leary. These ads direct users to clone websites resembling reputable Canadian news sources, where they are lured into cryptocurrency investment opportunities. Subsequent phone calls from fraudulent "financial advisers" manipulate victims into depositing funds, ultimately depleting their life savings.

Alex, having firsthand experience in the industry, attests to the manipulative tactics employed by scammers. Building rapport and feigning friendship with victims, particularly the elderly and isolated, are common strategies to extract information and coerce investments.

Image Source: Pexels|Photo by Tima Miroschnichenko
Image Source: Pexels | Photo by Tima Miroschnichenko

The investigation extends to the recruitment and employment practices of these call centers. Telegram chats reveal job postings specifically targeting Canadians, offering substantial salaries and commissions to successful fraudsters. Such incentives far exceed average wages in Ukraine, making scamming an appealing albeit morally bankrupt profession.

The audacity of these criminal enterprises is further evidenced by interviews conducted with call center managers. "Look, this business has been working already for how long? It's the same advertisements and the same everything…. Look, stupid people are always looking for some kind of whatever that they can invest in, do nothing, and bring in more money for [the scammers]," one of them said. 

Unabashedly acknowledging the fraudulent nature of their activities, these managers express confidence in the resilience of their schemes, despite economic indicators suggesting otherwise.

As Canadians continue to fall victim to these insidious scams, it becomes imperative for authorities to bolster enforcement efforts and educate the public on recognizing and reporting fraudulent activities.