How ‘Cloning Firms’ Scam Online Investors With Fancy Websites and Ads

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Fraudsters pose as banks in an attempt to scam people into transferring funds to them, warns the Alberta RCMP’s Integrated Market Enforcement Team (IMET).

Known as “brand hijacking” or “cloning company” scams, IMET claims that the scams target victims through online searches for investment products.

Top search engine results can include advertisements related to fake websites where victims are asked to provide their contact details and then scammers contact them posing as representatives of branded investment firms or companies. financial institutions.

As a result, victims buy fake investment products, trust scammers with their personal finances, and send them money through wire transfers and bank drafts.

“This particular trend towards fraud is very advanced, as crooks are usurping not only real institutions, but also real employees of those institutions,” said Sgt. Lloyd Schoepp of IMET, the specialized unit of the RCMP’s federal policing program that investigates and deters commercial fraud.

Tips for avoiding online investment scams

Identity theft, according to IMET, includes the use of fraudulent names, job titles and even credentials of genuine investment professionals.

Meanwhile, the websites and materials provided to victims are of high quality and often identical to those of well-known investment firms.

IMET said it was working closely with the Alberta Securities Commission and other Canadian securities regulators “to protect investors from this type of crime and build confidence in the capital markets of our country”.

However, it also recommends the following tips for avoiding an online investing scam:

  • Avoid advertisements found in search engine results and only use verified websites.
  • You can also contact a registered investment dealer directly to discuss your finances with a representative.
  • Be skeptical of very competitive or attractive returns on investment.
  • Find and compare the offers. If it sounds too good to be true, it probably is.
  • Never feel pressured into making an investment. Do your due diligence to determine whether the investment products are legitimate or not.
  • Watch for subtle variations in the email and internet domains used by scammers which, on closer inspection, do not match those of legitimate investment firms.

Those who believe they are the victims of a scam are encouraged by the RCMP to report it to local law enforcement and the Canadian Anti-Fraud Center online or by calling 1-888-495-8501.

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