You met Alex on a dating website. You clicked right away, and for the last six months you’ve been messaging each other at all hours. You get that giddy, excited feeling whenever you see a new message from Alex.
After everything you have been through in other relationships, you feel relieved and delighted to have finally met your person. You make plans to meet. You’re already talking about marriage.
Alex has told you all about a deal Alex is working on. One day, Alex calls you. Alex is upset because an investor has dropped out at the last minute. Alex needs cash right now to complete the deal, or the deal is tanked. There’s a lot of money to be made, enough for the two of you to start a new life together.
Alex needs a big sum, but you manage to pull it together and you invest.
Alex asks you to send a copy of your driver’s license, sign an agreement and send the money. You trust Alex, so you do it. You make plans to meet up. Before you can, there’s an emergency, this time involving Alex’s son. Alex needs more money. Alex can get the money back to you, it’s just a timing issue.
Plot twist: Alex doesn’t exist. You’ve been targeted by a romance scam. Once your money is gone, so is “Alex”.
It’s Not Going to Happen to Me
You’re a good judge of character. You can tell when people lie to you. You always verify things. How could this happen to you?
Romance scammers who run online dating scams are sophisticated. They’ll spend time to build your trust and make a connection with you.
They might work as a group, so you’ll be introduced to their friends, family members, or business associates. They’ll send you to websites that look legitimate, and provide you with business documents that look above board. They‘ll use spoofing apps so that when they call you, the caller id shows what they want it to show.
Their sole goal is to earn your trust, then take your money.
They are good at it. Canadians lost a reported $19 million to romance scammers in 2017, but the actual losses are likely to be much higher than that, because many people don’t report being scammed.
Things to Check if You Are Offered an Investment by Someone You Met Online
When we trust people, we let our guard down. We don’t check the things we would normally look in to. This is what romance scammers (and other fraudsters) rely on to take your money. Protect yourself by following these steps.
- Check that they are who they say they are:
- drag their photographs into a Google image search, to see if their image is being used by someone completely different or if it is a stock photo
- do online searches of the individual’s name and their company, including their name + scam e.g. “John Doe + scam”
- review the company website – are there unfinished pages? Are there typos? Does it make sense? Copy and paste the website text into a search engine to see if it appears on other websites
- Do a WhoIs search to see who the website is registered to, and check that person out
- if possible, meet them in person in a safe and public place
- Check the person’s background in offering investments:
- Ask questions and don’t be satisfied until you get answers. Ask for the documents that explain the investment. Did you receive an offering memorandum or prospectus? If you received documents, did you carefully read them? Is the person registered to sell securities? If not, why not?
- Check whether the offer makes sense, and whether it has any of the Investment Fraud Warning signs. Scammers know that you are too smart to be hooked by an offer that is too good to be true, so they will:
- make it look like the investment is safe; for example because there are assets or guarantees in place
- apply pressure on you to invest quickly
- try and override your gut instinct that something’s not right
Romance Scam Warning Signs
To recap, watch out for investment opportunities from someone who:
- is not registered to sell investments
- has been disciplined for securities law violations before
- applies pressure for you to invest quickly
- makes excuses for not meeting in person
- uses a stock photo or the same picture appears online with a different name
- asks you to send copies of your ID or provide personal information - e.g. your social insurance number (SIN)
- asks you to send money or provide bank account information
- proposes marriage before you have met in person
Protect Yourself and Others from Online Dating Scams – Report Scams Now
If you have any concerns about a person or company offering an investment opportunity, please contact BCSC Inquiries at 604-899-6854 or 1-800-373-6393 or through e-mail at [email protected]. You can also file a complaint or submit a tip anonymous using BCSC’s online complaint form.
Doug Muir is the British Columbia Securities Commission’s Enforcement Director.
In December 2012, the British Columbia Securities Commission issued two notices of hearing, one liability and sanction decision, one sanction decision and two settlement agreements. The Commission also issued one decision on jurisdiction and an Investor Alert. During December 2012, IIROC released one settlement agreement relating to a BC headquartered corporate registrant. The MFDA […]
During the holidays, many of us feel the need to give to those less fortunate. Be aware! Scammers feel the same need – but they feel the need to empty your pockets. Some of us donate throughout the year, and during this holiday season we like the opportunity to give to new and […]