Scams and shams – September 2017

A new report shows growing criminal activity among diplomats in Canada, while the FBI is reporting a recent surge in cyberwire fraud.

ILL-GOTTEN GAINS

Reality star’s ex-partners flipping mad

You’ve heard of people renovating and flipping houses for profit, but what about people flipping TV shows about houses for profit? That’s what two Texas business partners are accusing reality TV star Chip Gaines of doing, and that’s why they’re suing him for US$1 million. Gaines and his wife, Joanna, star in HGTV’s popular reno show Fixer Upper. It’s about the real estate and construction adventures of their company, Magnolia Homes. Problem is, Gaines’ former partners John L. Lewis and Richard L. Clark claim they founded Magnolia Homes with Gaines and he convinced them to sell their shares in it — to him — two days before HGTV picked up the show.

CON LETTERS

Beware the fake email

SPAM email on a computer screen

“This letter comes to you from the HR dept. It has come to our attention we have overpaid you by $400 so can you please”... oh, not really. If such an email appeared in your mailbox you’d recognize it as a fake, right? The evidence suggests otherwise. The FBI is reporting a surge in global cyberwire fraud, especially in the last few months of 2016. Most of the shams appear to be requests for payment from senior corporate executives or suppliers. The survey doesn’t track how much money was lost, but it is estimated the incidents collated by the FBI represent just 20% of the total.

UNREAL BROKERS

BC’s wild and crazy real estate scene

There’s a growing number of mortgage fraud cases in BC involving fake incomes, phoney offshore collateral and false tax information thanks to dealers working in a burgeoning shadow-banking sector — non-regulated financial institutions. BC’s Financial Institutions Commission has seen an increase in complaints about loan-application fraud to 200 in 2016 from 109 in 2013. Some liken the situation to the sketchy loans investors were exposed to after the US subprime meltdown of 2008.

RED ALERT

Not so diplomatic

Stiffing contractors, not paying landlords and doing whatever “johns” do in police raids are hardly activities you associate with the diplomatic corps. But reports from Global Affairs Canada show that foreign diplomats are racking up more unpaid debt, breaking laws and violating passport rules. The reasons for the rise in misbehaviour are not clear, though it may be related to programs and tip lines that make it easier to report problems. Among the most egregious infractions: one embassy’s $283,750 in taxes owed to the CRA, $10,000 in salaries owed to workers at another, and a diplomat who left Canada owing $4,700 to an Ottawa car dealership.

CARD SWIPERS

Blocked before they know it

Some UK banks unearthed a few surprises when customers were asked about banking fraud. Some 66% of respondents experienced one fraudulent incident in the past year; 29% reported two incidences; and 5% reported three. Although some of the institutions tried to contact customers when they suspected fraudulent activity, most of the victims first heard about the frauds when their cards got blocked — and before they were informed by the banks.