Melissa Plett was initially unsuspecting when she received a fraud alert call last month, which claimed to be from the Royal Bank of Canada (RBC). The call appeared legitimate as her phone displayed RBC’s number, and the caller used familiar language typically used by her bank. Plett, 44, described the scam as well-executed, with the caller sounding convincing and leading her to believe her account was at risk.
The caller informed Plett, residing near Montreal, that someone in Vancouver was attempting to take $2,000 from her bank account. Following the caller’s instructions, Plett logged into her RBC banking app on her mobile phone while staying on the call. She made changes to her account as advised to protect her funds. Unfortunately, by the end of the call, $14,510 had disappeared from her two RBC accounts, one personal and one for her marketing business. Plett only realized she had been scammed when the actual RBC contacted her shortly after to report fraudulent activity in her account.
Despite not disclosing any personal information or codes to the fraudster, when Plett requested a refund from RBC, she was denied. The bank stated that she was responsible for the losses as she was active in her account when the money vanished. The significant financial loss left Plett feeling helpless and emotional.
Plett’s ordeal is part of the bank investigator scam, where fraudsters pose as bank or fraud investigators, often contacting victims by phone. These scammers manipulate victims into believing their accounts are compromised, coercing them to take immediate action, such as sharing sensitive information like credit card numbers. The scammers’ ability to appear credible is enhanced by possessing personal details about the victim and utilizing spoofing techniques to mimic the victim’s bank’s phone number.
According to Jeff Horncastle, an outreach officer with the Canadian Anti-Fraud Centre, the scam, while not new, is evolving in sophistication, resulting in increased financial losses. In the first half of this year, the Canadian Anti-Fraud Centre reported 677 victims of this fraud, with total financial losses amounting to $11.7 million, nearly double the previous year’s figures for the same period.
Montreal police are actively investigating a criminal network linked to this scam and have identified over 220 RBC customers who fell victim, with estimated losses totaling $1.5 million. RBC has collaborated with the police during the investigation but refrained from commenting on ongoing police matters.
In the aftermath of being denied a refund by RBC, Plett escalated her case within the bank but faced further rejection. She emphasized the need for banks to better assist customers who trust them with their finances, especially in scenarios where customers unknowingly fall victim to scams.
Consumer advocate Sylvie De Bellefeuille advocates for full compensation for victims of such scams, emphasizing the elaborate tactics employed by fraudsters. She is currently assisting 14 victims, primarily seniors in Quebec, affected by the bank investigator scam, with the majority being RBC customers.
While victims of credit card fraud are protected by federal law, banks may dispute claims of unauthorized transactions if they deem the customer negligent. Finance Canada has indicated that there are presently no legislative mandates requiring banks to reimburse customers for unauthorized banking transactions.
RBC’s response to Plett’s case was not disclosed, but the bank asserts its commitment to addressing customer concerns directly and collaborating with authorities to combat fraud. RBC offers a digital banking guarantee ensuring refunds for unauthorized transactions caused by fraud or coercion.
Plett’s financial records reveal additional unauthorized transactions on her mortgage line of credit, along with fees charged by RBC for the wire transfers. Following media inquiries, RBC initiated an investigation into Plett’s case.
Proposed changes to strengthen federal protections for bank customers include enhanced data collection on scams targeting customers and expanded reimbursement for fraud victims. The federal Department of Finance has not provided an update on the implementation timeline for these proposals.
De Bellefeuille urges prompt regulatory enhancements to aid victims of such scams, emphasizing the detrimental impact on individuals’ finances and well-being. The persistent prevalence of the bank investigator scam underscores the urgency for improved consumer protection measures. If individuals receive suspicious calls from their bank, experts recommend hanging up and contacting the bank directly using official contact information to verify the authenticity of the call.