Think You Can Spot a Scam? Fraudsters Are Counting On It

You probably think you can spot a scam. So do nine in 10 Canadians, according to a recent TD study

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— and yet the Canadian Anti-Fraud Centre

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says Canadians have reported losing a whopping $2.4-billion to fraud since 2022.

Andrew Sigfrid, Senior Director of Fraud Solutions at TransUnion, says overconfidence may come down to the frequency of fraud attempts Canadians face.

“Canadians are being hit through multiple channels, multiple times a day," says Sigfrid. "Maybe I didn't fall for nine different scams today, so that's where a lot of this confidence comes from... but it's only that one time where you slip up."

If slipping up is the danger, the fix isn’t more confidence or better awareness, it’s giving yourself a set of rules that don’t depend on catching a scam in the moment.

The scam that broke through

Almost one in four Canadians (24%) say they or a family member have been victimized by financial scams or fraud in the past year. One is Amanda, a production manager from the Greater Toronto Area. She thought she could spot a scam from a mile away, until one broke through.

“I was busy, I was in the middle of making dinner, my kids were running wild, and my phone rang,” she says. “I didn’t even notice until weeks later that over $10,000 went missing from my savings account.”

Scammers, claiming to be from her bank’s fraud department, called to verify an unusual credit card charge. During the call, they were able to gain personal information they used to bypass two-factor authentication, access Amanda’s bank account and even apply for a line of credit in her name.

Knowing better doesn’t mean doing better

Like Amanda, Canadians are woefully overconfident in their ability to spot a scam; 89% feel confident in their ability to spot fraud and 41% don’t educate themselves on fraud prevention. And scammers are using that overconfidence to their advantage.

Tarundeep Dhot, Vice President of Canadian Fraud Management at TD, says that knowing what to look for isn’t enough to prevent yourself from becoming a victim.

"There's a lot of awareness about scams and fraud in the media right now, and having knowledge is always a good thing," he says. "It's like reading about the benefits of eating healthy but not actually eating healthy. You already know what the outcome is going to be."

Despite their confidence, more than half of Canadians admit to behaviours that could put them at greater risk. Some 52% say they’ve done things like accessing personal accounts using public Wi-Fi, clicking links in texts or emails before verifying the source and opening email attachments from unknown senders.

In addition to taking risky behaviours, a separate recent TransUnion Consumer Pulse Study

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points to another problem: many Canadians aren’t sure what preventive action to take. One-third of Canadians have taken no action regarding cybersecurity concerns in the last 60 days and half of those (51%) say they’re simply not sure which actions, if any, to take.

"There are things you can do proactively — strong password management, multi-factor authentication,” says Sigfrid. “Those might seem like things you do after the fact, but you can do them before, too.”

Put the problem on ice

Sigfrid also points out that residents of Ontario and Quebec can freeze their credit files with Equifax and TransUnion, making it harder for someone to open new credit in their name. British Columbia has passed similar legislation, but it won’t take effect until August 2027.

The TransUnion study suggests that overconfidence may also play a role in how people respond after a breach. TransUnion found that data breach victims were more likely to change passwords and check for unauthorized activity than to sign up for monitoring services or freeze their credit.

"That inaction could be a function of not knowing what to do to take remediatory action, or not even knowing what level of risk is associated with a particular breach," says Sigfrid.

Dhot points out the emotional toll of fraud can also prevent people from taking action after becoming a victim.

"Getting scammed is an invasion of privacy; there's an emotional loss on top of the financial one," he says. "A lot of people don't come forward because of embarrassment, and that silence doesn't help them, or anyone else who might be targeted the same way."

Pause and verify

If awareness doesn’t equal prevention, confidence in your ability to spot a scam can become a vulnerability of its own. Experts suggest that rather than being on the lookout for shady behaviour, Canadians should make it a rule to not share any personal information without being sure of who they’re talking to.

Amanda says her scammers did their homework and fed her enough of her own personal information to make her think she didn’t need to verify the call.

“They knew my full name, they knew what accounts I had, and they even had details of legitimate transactions,” says Amanda. “The phone number looked legitimate. I didn’t think anything seemed unusual.”

Dhot says the increasing level of sophistication in scams like the one that targeted Amanda is exactly why “pause and verify” is necessary. He says scammers are increasingly using AI to appear more legitimate and are successfully impersonating banks and law enforcement.

The easiest way to verify who you’re talking to, says Dhot, is to place the call yourself. “Disconnect the call, phone your financial institution directly and ask what's going on," he says.

On the advice of her bank, Amanda has taken steps to prevent a recurring incident. Among other things, she’s frozen her credit files with Equifax and TransUnion, making it harder for someone to open a new account in her name.

She’s also decided to stop looking for scams and take her own judgment out of the equation.

“I just assume everything is a scam,” Amanda says. “If they’re the ones calling me, I hang up and call back using a number I trust.”