Security can be defined as freedom from, or resilience against, potential harm from external forces.  Understanding some key threats and the simple precautions you can take can help protect you from being a victim of crimes such as identity theft and fraud.

What is identity theft?

Identity theft is a criminal act in which an imposter obtains key pieces of someone else’s personally identifiable information to impersonate the victim and commit a crime.  Among other things, identity thieves may use the stolen information to gain access to your financial accounts and computer files; make purchases; apply for mortgages, personal loans and credit cards; obtain passports; and hide their criminal activities.

Identity thieves are generally looking for the following information:

  • Social Insurance Numbers, driver’s license numbers, passport numbers
  • Bank account numbers
  • Usernames, passwords and PINs for online services
  • Credit card information (numbers, expiry dates, CVV codes)

Identity theft: Preventative Tips

  • Never share your passwords, PINs or verification questions with anyone
  • Beware of mail, phone and internet promotions or fraudulent websites that ask for personal information
  • Don’t send financial or other confidential information via email
  • Don’t reply to any e-mail or pop-up message that requests you update or provide personal information
  • Don’t open attachments unless you are sure it is from a valid and reputable source
  • Equip your computer with a firewall which helps prevent outsiders from accessing the data on your computer, and ensure virus protection software is up to date
  • If you are providing sensitive or financial information online, limit business with financial institutions and online merchants that you know and trust – and be sure the site is secure. Look for a URL that begins with https:// and shows a padlock
  • Request a copy of your credit report from a national credit bureau each year and ensure information is correct
  • Shred/destroy sensitive information before throwing it out
  • Review financial statements regularly and report any discrepancies

What is mortgage fraud?

Mortgage fraud is a criminal act that occurs when there is a deliberate misrepresentation of information to obtain mortgage financing that would not have been granted if the truth had been known.  This can include:

  • Misstating occupation, inflating income or the length of employment.
  • Misstating type of employment (e.g. salaried/full time employee instead of contract, part time, hourly or commission-based employee, or are self-employed)
  • Misrepresenting the amount and/or source of down payment.
  • Purchasing a rental property and misrepresenting it as owner-occupied.
  • Not disclosing existing mortgage and/or debt obligations.
  • Misrepresenting property details or omitting information to inflate the property value.
  • Adding co-borrowers who will not be residing in the home and do not intend to take responsibility for the mortgage.
  • A con artist who convinces someone with good credit to act as a “straw buyer”. A straw buyer is someone who agrees to put his or her name on a mortgage application on behalf of another person. In return for their participation, straw buyers may be offered cash or promised high returns when the property is sold. Often, straw buyers are deceived into believing they will not be responsible for the mortgage payments.

Mortgage Fraud:  Preventative tips

To protect yourself and your family from becoming victims of, or accomplices to mortgage fraud, be an informed consumer. This means:

  • Never deliberately misrepresent information when applying for a mortgage.
  • Use licensed or accredited mortgage and real estate professionals.
  • Never accept money, guarantee a loan or add your name to a mortgage unless you fully intend to purchase the property, otherwise you could be held responsible for the debt.
  • Never sign legal documents without thoroughly understanding them, and get independent legal advice from your own lawyer.
  • Never sign any documents that are blank or contain blank fields.
  • Obtain the sales history of any property you are thinking about buying, and consider having it inspected and appraised.
  • Make sure any deposit for an offer to purchase is payable to and held “in trust” by the realty company or lawyer.
  • Be wary of anyone who approaches you with an offer to make “easy money” in real estate.

Reporting Identity Theft and Fraud

If you suspect that you or know that you are a victim of identity theft or mortgage fraud, you should contact The Canadian Anti-Fraud Centre Toll-free line: 1-888-495-8501