Credit card fraud in Canada stirs financial anxiety in many individuals. According to a survey by CPA Canada, 86% of respondents reported that they were aware of credit card fraud in 2019 and nearly 39% refused to use their credit card with certain vendors for fear of credit card fraud. In this guide, we’ll explore how to identify and avoid credit card fraud.
Credit card fraud occurs when an individual obtains someone’s credit card information and uses that information to make an unauthorized purchase. To commit credit card fraud, the individual does not need to steal the physical credit card; they only need the card information since it can be used to make a purchase online.
“Everyone who steals a credit card, forges or falsifies a credit card, uses or traffics in a credit card or a forged or falsified credit card, or uses a revoked or cancelled credit card is guilty of an indictable offence and is liable to imprisonment or punishable on a summary conviction.”
– Criminal Code of Canada, section 342(1)
In Canada, credit card fraud is a punishable crime. The Criminal Code of Canada states that credit card fraud includes the following:
There are various ways that people can obtain the credit card information needed to commit a credit card scam. Some of the most common methods include:
If you have fallen victim to credit card fraud, you may experience one or more of the following credit card fraud detection indicators:
There are a number of ways a fraudulent individual can obtain your credit card information:
| Response | prefer_not_to_say | Middle Income | Lower Income | High Income |
|---|---|---|---|---|
| In a typical month, I do not carry a credit card balance | 75% | 20.17% | 29.24% | 21.77% |
| Less than $99 | 10% | 10.64% | 18.13% | 7.48% |
| Between $1,000 and $4,999 | 5% | 17.09% | 14.62% | 21.43% |
| Between $100 and $499 | 5% | 19.33% | 18.42% | 17.01% |
| Between $500 and $999 | 5% | 18.77% | 11.7% | 15.99% |
| Between $5,000 and $9,999 | 7.28% | 3.8% | 5.44% | |
| More than $10,000 | 6.72% | 4.09% | 10.88% |
Fortunately, there are ways you can prevent credit card fraud from happening to you:
Even if you’re careful, you might fall victim to credit card fraud. Here’s what you can do to rectify the issue:
Fortunately, your card will be frozen or cancelled the moment you report the theft. Even better, most major credit cards have their own version of fraud protection, such as Visa’s and Mastercard’s Zero Liability protection. This means that you won’t be held liable for fraudulent transactions as long as certain eligibility criteria are met.
Consult your card issuer about whether you are covered in your particular circumstances. An investigation will usually be required and may take up to a few weeks, during which time you may be offered a card replacement.
Each of Canada’s five largest banks manages credit card fraud differently. Below is a summary of contact information for each institution:
| BMO credit card fraud | Call 1-844-837-9228 to report BMO fraud Email phishing@bmo.ca with forwarded suspicious emails or texts as attachments |
| CIBC credit card fraud | Call 1-800-663-4575 |
| TD credit card fraud | Call 1-800-983-8472 |
| RBC credit card fraud | Call 1-800-769-2512 |
| Scotiabank credit card fraud | Call 1-800-472-6842 to report Scotiabank fraud Email phishing@scotiabank.com with forwarded suspicious emails or texts as attachments |
Usually, only serious crimes result in a police investigation. If you only lost a couple of hundred dollars, which most financial institutions refund to you anyway, they may not do an investigation. In general, credit card fraud is investigated federally by the RCMP and Canadian Security Intelligence Service (CSIS).
Since credit card fraud is often committed over the Internet, it is traceable. This means there’s a pretty good chance of the individual getting caught if the work is put in. Scammers use triangulation to better conceal their tracks, but they can still be traced.
The police may not investigate your individual instance of credit card fraud if you report it. However, making a formal statement to the police could contribute to a larger case of credit card fraud.
If the offender is caught, jail time for credit card fraud can range from 6 months to 10 years. In addition, a fine of up to $5,000 may be applied. Anyone who is convicted of credit card fraud will receive a criminal record, which limits their ability to travel and work as well as their overall reputation.
Sometimes, credit card fraud and identity theft can overlap, but they are different. Credit card fraud involves stealing someone’s credit card information to complete an unauthorized purchase.
Identity theft is the process of stealing personal information, such as birth dates, Social Insurance Numbers (SIN) or bank account information. The personal details are then used to take out new credit, which could be credit cards, or otherwise impersonate someone else in an attempt to complete some kind of action. Like credit card fraud, identity theft is also a punishable crime in Canada.
If you report credit card fraud that isn’t really credit card fraud, this could be considered a crime, too. Most financial institutions will resolve credit card fraud by refunding the fraudulent transactions. However, they usually perform an investigation first, which means they may discover you lied. This could result in many things, such as being banned from using that financial institution’s services due to being flagged as a fraud risk.
Alternatively, mistakes happen. You may have reported credit card fraud in error because you didn’t recognize a transaction. If this is the case, notify everyone that the transaction was not fraudulent.
Credit card fraud is quite common in Canada. You can protect yourself by keeping credit card information confidential and remaining vigilant of fraud. If you’re a victim of credit card fraud, be sure to address the situation immediately as it will be easier to rectify.
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