Protecting yourself from scams during the
COVID-19 pandemic
Investors are encouraged to be extra vigilant during times of uncertainty against fraudulent investment schemes that take advantage during times of crisis such as the COVID-19 pandemic.
Remember to look for reliable information related to COVID-19 through the World Health Organization, the Government of Canada, or your local government.
Schemes to Watch Out for and How to Protect Yourself
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Pump-and-Dump Schemes |
You get a text or email, or find a website, claiming that a company has discovered a vaccine or found a cure for COVID-19. You are encouraged to buy shares in the company now. You are told that this is a once-in-a-lifetime investment opportunity and the stock price is going to go up soon. In reality, the fraudsters own many of the company’s stock. They create hype through internet campaigns to encourage people to buy the stock and artificially increase the price. As soon as the price increases, the fraudsters sell their shares, the price of the shares fall, and the new investors lose money. Find out how to protect yourself from Pump-and-dump schemes here: |
| Questionable Offers | You get a text, email or phone call, or find a website, that offers you an investment opportunity related to COVID-19 miracle cures, herbal remedies, vaccines or faster testing.
Find reliable information related to COVID-19 through the World Health Organization and the Government of Canada |
| PhishingPhishing A type of fraud where a stranger poses as a trustworthy person or business to get your private information, such as passwords or credit card numbers. It is often done using email or an instant message.+ read full definition Schemes | You get an email, text message or phone call from someone claiming to be your bank, a reputable brand, your employer or government agency (for example Service Canada or the Canadian Revenue Agency). The email, text or phone call looks or sounds real and asks you to provide personal or financial information (or in the case of an email or text, click on a link).
These communications are designed to steal your personal information and money. Lately, fraudsters are taking advantage of the COVID-19 crisis and are demanding the prepayment of fees, taxes on income, or any other type of charge associated with a government assistance or economic relief program such as the Canadian Emergency Response Benefit (CERB).
Remember that legitimate government agencies generally will never ask you to provide personal information via email or text message. Find out how to protect yourself from Phishing Schemes here:
For information on how the Government of Canada will communicate with you, read this. |
| Work from Home Scams | You see an advertisement that provides an opportunity to secure high profitsProfits A financial gain for a person or company. Equals the money left over after you subtract your costs from the money you made.+ read full definition by working from home as a securities or derivatives trader without requiring a license or experience in the financial markets. However, the firm demands the payment of fees from would-be traders.
Anyone in the business of trading securities or derivatives, or providing investment advice in Canada must be registered with their securities regulatorSecurities regulator A government agency that enforces the securities act in jurisdiction it has authority over. This act is made up of laws that establish rules for issuing and trading securities. The Ontario Securities Commission is the securities regulator for Ontario.+ read full definition. Find out how to protect yourself from Work from Home Scams:
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| Unauthorized or Fraudulent Charities | You are contacted by a charity and are pressured to urgently donate to benefit victims of COVID-19 or fund research.
Be careful because this could be a type of phishing scheme. Before donating to a charity, check that the charity is registered and that its status as a charity is in good standing. It is a good idea not to respond directly to an email, text message or phone call and to instead independently go to the charity’s website that is listed on the Government of Canada website. |
| Advanced Fee LoanLoan An agreement to borrow money for a set period of time. You agree to pay back the full amount, plus interest, by a set date.+ read full definition Scams | You see an ad in a recognized print, digital publication or internet site that guarantees that you will receive a loan or credit card regardless of credit history. These ads usually depict very attractive interest rates and normally, these scams request an up-front fee via a money transfer or a credit card. These fraudsters sometimes create fake websites with copied logos from reputable institutions and use prepaid cell phone numbers to talk to victims.
If you provide money you will not receive a loan and will never get your money back. Legitimate lenders will never guarantee or suggest they probably will provide a loan before you apply and before your credit history is verified. Protect yourself from Advanced Fee Loan Scams:
Learn more about Advanced Fee Fraud and how to further protect yourself: |
TAKE ACTION
Read an updated list of reported COVID-19 scams.
You can also find more information on individuals and companies that appear to be engaging in activities that may pose a risk to investors. This information is not exhaustive. You should always check the registration of the individual or company you’re dealing with and research the investment before you buy.
To find updated and accurate information regarding government programs and health-related information visit the below links: