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National Fraud Study Released and the Statistics are Interesting

  • September 12, 2019
  • Topics: Uncategorized

A new national fraud study is revealing some important insights into fraud across Canada.

Fraud Aware 2019: National Study on Reported Fraud Cases in Canada, by MNP LLP, has compiled data from more than 200 convictions of fraud prosecuted between 2012 and 2018 to gain perspective into how organizations can reduce this type of crime.

The study found that while fraud is occurring across the country, there are pockets where it is higher — namely, Ontario, Quebec, Alberta, and British Columbia.

Of the provinces:

  • Ontario had far and away the highest number of fraud cases with 122. The second-highest number of fraud cases was B.C., with 34.
  • C. had the largest total losses, of $191.9 million.
  • Alberta had the highest median monetary fraud at $1.25 million.
  • Ontario and B.C. were victim to a small number of extremely high-value frauds.

The top fraud schemes were:

  • Stock price manipulation.
  • Ponzi schemes.
  • GST fraud.
  • Investment fraud.
  • Cash fraud.
  • Tax evasion.
  • Mortgage fraud.

Profiles of fraudsters:

  • About 62% of the fraudsters, both male and female, were between 40 and 59 years old, and stole significantly more than younger fraudsters.
  • The older the fraudster was, the more money was lost.
  • Greed was the motivator in 63% of the cases.
  • Other motivators included gambling, financial hardship, drug addiction, and relationships (such as supporting a mistress).

“Trying to make ends meet, shoring up a failing business, paying for a family medical procedure, all were exceptions,” the study states. “Greed, the desire for more, proved the overwhelming motivator.”

The study showed that although restitution was ordered in 70% of fraud convictions, it amounted to only 29% of the fraud losses.

View the full study here: https://www.mnp.ca/Style%20Library/mnp/pdf/analytical-fraud-report.pdf

A key takeaway from this study is that while the overall number of fraud cases may be small, the amount taken is anything but. This is why it pays to be vigilant when dealing with fraud — even one fraud case can significantly harm an organization.

The sixth edition of the Teranet Market Insights Report found that between 2016 and 2018 the number of parties on title amongst first-time homebuyers in Ontario has “increased dramatically.” In the condo market, first-time condo buyers with two names on title increased by about 3%. The number of same buyers with three names on title increased from 2.2% to 5.5%.

As co-ownership rises in popularity, and the number of signors on title is increasing, mortgage due diligence is even more important.

Lenders can take particular precaution by using tools. For instance, Purview offers lenders the Fraud Check solution, which signals potential issues with property ownership, power of sale, and other possible fraud flags.

Access Fraud Check and other property tools that mitigate fraud risk today through Purview.

Call 1-855-787-8439 or visit www.purview.ca.

Purview is just one of Teranet’s Financial Services Solutions; stay tuned for our upcoming portfolio unveiling!

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