Category Archives: credit card fraud

Pros and Cons of Joint Credit Cards

CoupleUsingCreditCard_ImageSource_DigitalVision.jpg

When two people have a joint credit card account, both people can make charges to the credit card and the card’s history is included on both people’s credit report. Both people are also liable for the credit card payments. When the payments become delinquent, the credit card issuer can go after either cardholder for payment.

If you’re thinking about getting a joint credit card with a partner, spouse, or child, knowing the pros and cons will help you decide whether it’s a good idea.

Advantages of Joint Credit Cards

You share a bill. When you and the other person, your spouse for example, have one rent, one electricity bill, one cell phone bill, it seems only natural to share a credit card bill. Having one less bill to pay can let you make the most of your income. Plus, when it’s time to pay off your debt, you’ll have an easier time deciding which card to pay back first.

Help one person get better credit. Adding a spouse or family member with bad credit to your credit card can help them get better credit. But it will only work if the credit card is managed right – the bill is paid on time and the balance is kept low.

Help one person get a credit card/good interest rate where they otherwise wouldn’t. Being added as a joint user might be the only way to get your spouse a credit card, or to get her a low interest rate.

Disadvantages of Having a Joint Credit Card

Both people are legally responsible for making the payments. That means the credit card issuer can take legal action against you for charges you might not have made.

You could even be sued and have your wages garnished.

Credit card disagreements could cause relationship problems. In a 2008 poll conducted for CreditCards.com, 19% of respondents who shared a credit card said they had arguements with the other person about the account. Seven percent said they’d cancelled a shared credit card because it caused relationship problems.

Breakups or divorce make it hard to manage the credit card. No matter what a divorce decree says, the credit card issuer holds you to the original credit card agreement. So if your ex-spouse isn’t paying his or her share of the credit card bills, your credit can stil be affected. It’s even harder to manage the credit card bill if you sever ties with someone you were dating or even a friend or family member.

One person could use the credit card to hurt the other. It sounds childish, but it happens, often after a breakup. One cardholder could go on a revenge spending splurge, leaving the other cardholder with the bill. If the revenge-seeker already has bad credit, she (or he) has nothing to lose from a maxed out credit card or a few more late payments.

Should You Share a Credit Card?

It’s wiser to keep separate credit cards. Before you make the decision to get a joint credit card, evaluate your reasons for sharing a credit card. In the CreditCards.com survey, only 9% of respondents said they felt closer to the person after sharing a credit card.

Similarly, 9% said they felt more in control of the relationship.

Discuss the pros and cons of having a joint credit card. Make sure both people understand the effect a breakup could have on your credit history.

Source: TheBalance.com – Updated September 10, 2016

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Millennials comprise half of fraud victims—study

A recent study by consumer credit reporting agency Equifax Inc. revealed that the demographic most susceptible to fraud was the millennial sector, in defiance of common stereotypes that seniors are more liable to get swindled.

The survey found that approximately 50 per cent of suspect credit applications last year involved millennials and Generation Y consumers, ranging from 16 to 36 years old. The agency processes around 15 million applications annually in Canada, with 1 per cent of this figure being suspected fraud attempts.

Equifax officials attributed this significant proportion of young fraud victims to a still-developing understanding of the internet, even though this segment is considered the most “wired” generation ever.

“They are the more sharing, less caring generation. They think they are invincible and share way too much information online,” Equifax Canada chief privacy officer John Russo told the Financial Post.

Russo noted that fraud is often perpetrated against youngsters via phishing scams and fake in-app purchases.

“They can be caught with text or email. They get something like ‘opportunity to work from home for $1,000 a day or free downloadable ring tones.’ The younger generation just automatically clicks. They are playing something and it says ‘buy now’ and it’s a fraudulent site looking for information to get credit,” he explained.

The survey also found that Generation X consumers comprised 29 per cent of fraudulent application claims, with Baby Boomers coming in at 17 per cent. Approximately 53 per cent of Canadians reported having experienced financial fraud at some point in their lives.

Source: MortgageBrokerNews.ca – by Ephraim Vecina | 22 Mar 2016

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Most Canadians are in the dark. Shedding light on your credit score.

how to improve credit score

As a Canadian, maybe you’re in the dark about your credit score. In fact, if you’re like 56 per cent of the country’s adult population, you have never checked your credit score, according to a 2015 survey sponsored by the Bank of Montreal. This finding is astonishing to me.

Credit scores are widely available to many in finance and business who check credit standings before they make decisions that can affect a person’s or a family’s way of life, often in big ways. Since others are keeping tabs on the way you handle money and credit, shouldn’t you stay on top of what it is they are seeing?  

You can be sure that Equifax and TransUnion have created a credit report and a credit score in your name.

Others can check up on your credit score through a simple request for information from what are called credit bureaus (also known as credit reporting agencies). In Canada, the two big bureaus include Equifax and TransUnion. They keep track of the way you handle credit and create a history of your financial behaviour through what is called a “credit report,” which forms the basis for your credit score.

If you’ve ever used a credit card, taken out a personal loan, or joined any sort of “buy now, pay later” plan – among other ways to borrow – you can be sure that Equifax and TransUnion have created a credit report and a credit score in your name.

Your score provides a snapshot of your credit worthiness in the form of a numbered ranking.

Your credit score is the big highlight of your credit report. Your score provides a snapshot of your credit worthiness in the form of a numbered ranking. It is tallied not only by the credit bureaus but by lenders, too. If your score is low, you may run into trouble borrowing or applying for something. If that’s the case, getting credit counselling from a qualified, not-for-profit agency such as Credit Canada should become a priority.Credit scores consist of three-digit
numbers that show whether
you are a good or a bad credit risk: Scores
range from 300 (for very bad, high-risk
folks), to 900 (for very good, low-risk individuals). You raise your score when you show lenders that you can use credit wisely. Your score drops when you show difficulty managing credit. Your score changes over time as your credit report is updated.Credit score charts look something like this:

Credit Score Quality

|300 to 559| Poor 

|560 to 659| Fair

|660 to 724| Good 

|725 to 759| Very good 

|760+| Excellent

By law, credit bureaus can sell credit reports to banks, credit unions, and other financial institutions, credit card companies, auto leasing companies, and retailers. In addition, for assurance that you are trustworthy, other organizations are allowed to view your credit history and credit score. These organizations include mobile phone companies, governments, employers, landlords, and in some cases insurance companies (rules vary somewhat across Canada).

Get all the details about credit reports and credit scores; start by visiting a Web site chock full of information.

As the Government of Canada points out, “Usually, when you sign an application for credit, you allow the lender to access your credit report. Your consent generally lets the lender use your credit report when you first apply and anytime afterward while your account is open. In many cases, your consent also lets the lender share information about you with the credit reporting agencies if your application is approved.”

I strongly encourage you to get all the details about credit reports and credit scores; start by visiting a Web site chock full of information from the Financial Consumer Agency of Canada (FCAC). The Web site also provides information about how you can get your credit report free by snail mail, or how you can access it online for a nominal fee. Visit FCAC here

Source: Credit Canada Debt Solutions Laurie Campbell on Tuesday, July 21, 2015

How to Boost Your Credit Score at Any Age

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Improving your credit score can be more arduous at certain points in life — and inspires different approaches. CBS News — with the help of Credit Karma — has broken down average credit score by age, and the options for improving a credit score. We’ve added our advice and directed you to the parts of our Solution Center that can help you with your credit.

In Your 20s

  • Average credit score: 635.
  • What to do about it: Get a credit card without annual fees as soon as you can, which our Solutions Center’s Finding the Perfect Plastic page can help you do. “Ask Stacy: How Can I Get Credit Without Credit?” can also help. Then, pay off the bills on time every month and get another card after a few months of responsibly managing the first one. Having multiple cards builds up your “payment history” score category, which constitutes 35 percent of your FICO score.

In Your 30s

  • Average credit score: 645 to 646.
  • What to do about it: Continue paying off credit card bills on time every month and monitor your credit score carefully. In truth, this advice applies to your credit score at any age. Don’t apply for any other credit for at least six months before applying for any big loans like a mortgage, Greg Lull — Credit Karma head of consumer insight — told CBS.

In Your 40s

  • Average score: 648 to 657.
  • What to do about it: If you’ve built up a couple of decades of credit history responsibly, consider refinancing higher-interest loans to secure a better rate. Our Solutions Center can help you find the best rate on loans like mortgages, car loans and personal loans.

In Your 50s

  • Average score: 671 to 685.
  • What to do about it: If you have multiple credit card accounts, focus on the one or two that offer the best cash back or rewards. AS CBS reported: “There’s no downside to leaving no-fee cards outstanding, but you have enough credit history that it’s not going to hurt you if you cancel a credit card or two that charges an annual fee.”

In and beyond your 60s

  • Average score: 699 to 712 for consumers in their 60s, 728 for consumers in their late 70s.
  • What to do about it: Resist the temptation to use your high credit score to take on more debt than you can afford. Chances are, you are in a situation where you are living off a decreasing income or limited retirement savings. According to CBS: “Once you’re living on a fixed income from pensions, savings and Social Security, it’s a good idea to be paying down those debts.”

How does your credit score measure up to the average score for your age bracket? 

Source: MyDailyFinance.com By Karla Bowsher

Understanding Credit

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Source: Canadian Bankers Association

Last modified: 02 January 2013

Many consumers use credit to help manage their personal finances. Credit can be a mortgage to buy a house, a loan to buy a car, a line of credit for larger purchases or a credit card to make everyday purchases more convenient. It’s important to understand how different types of credit work, and how to use credit to build a strong personal credit history. This section provides information on how a credit card transaction works, credit card products, budgeting, and avoiding money mishaps. Understanding credit is the key to using it wisely and making it work for you.

How a credit card transaction is processed

Credit cards are a convenient and simple way to pay for purchases and, when using a credit card, you are using a sophisticated and reliable worldwide payment system. There are many benefits for consumers when using credit cards and for merchants when accepting them as payment, and all share the costs to the credit card system.

Check out the document, Understanding the Credit Card Transaction Process, for more information on how a credit card transaction is processed and the shared benefits and costs of this payment option.

Using credit wisely

It is sometimes easy to pay for purchases on a credit card, but don’t forget that you have to pay for what you buy later. Here are some guidelines for keeping control of your financial affairs and making credit work for you, not against you.

  • Make a budget for yourself and stick to it. Make sure that you know what is coming in and what is going out. That way you will avoid nasty surprises on your credit card bill.
  • Avoid impulse buying. If you had to pay in cash, would you be making this purchase?
  • Comparison shop as a matter of habit. Never buy anything – and that includes any form of credit — without comparing costs and value.
  • Always read and understand credit application forms before you sign them.
  • Be careful when co-signing a loan or guaranteeing a loan on behalf of others. Remember that you could end up paying off the loan if the borrower cannot handle it. Ask the same questions of the borrower that the lender would. Know the risks involved so that you can make a sensible decision.
  • Be knowledgeable about the cost of credit. Are you using the right type for your purpose? Are you using a more expensive form of credit than necessary? For example, if you’re getting loans from a payday lender, talk to your bank. Banks have a variety of short-term loans that are much cheaper than payday loans, including lines of credit, overdraft protection and even credit cards.
  • Be sensible about the number of credit cards you use. How many do you really need? Are you using them simply because you have them?
  • Keep track of all your credit purchases. Save the receipts for checking against the monthly statements and for keeping a running total of your obligations.
  • Remember, whether you use cash, a cheque, a card or a loan to pay for your purchases, to check out the reputation of the merchant, the store’s return policies, the quality of the goods and the product warranty. Using credit to pay for something does not absolve you of your consumer responsibilities.

Credit can be good or bad. It’s all about how you handle it. Before you decide on credit, carefully consider all of the factors and weigh them against your personal needs and values. For additional information on credit products, please visit the Financial Consumer Agency of Canada’s website. For information specific to your bank, please visit your bank’s website.

Protect yourself from real estate fraud

A stack of files labeled 'real estate fraud'

Source: Financial Consumer Agency of Canada
Real estate fraud

In Canada, real estate fraud is not as common as other types of fraud (such as debit or credit card fraud). But for the victims, the financial loss can represent a significant loss—since it can mean, in the worst case scenario, losing their home. It is important to know that real estate fraud exists, how it happens and how you can protect yourself against it.

There are various types of real estate fraud. Two types of real estate fraud that may result in financial loss for consumers include title fraud and foreclosure fraud. Read on for more information on each type.

Title fraud

When you buy a home, you buy the title to the property. The lawyer registers you as the owner of the property in the provincial land registry system.

Title fraud starts with identity theft, which occurs when your personal information is collected and used by someone identifying himself or herself as you. There are many ways criminals can steal your identity without your knowledge, including:

  • dumpster diving
  • mail box theft
  • phishing
  • computer hacking.

They then use your identity to assume the title of the property and sell the home or get a new mortgage. For example, if you already own a home, a criminal could fraudulently discharge your current mortgage, transfer the title, secure a larger mortgage and put the home under his or her own name.

Once the money from the sale or new mortgage is advanced, the criminal can leave with the money. You might not be aware of the fraud taking place until after it has been committed. You may find out once the mortgage lender contacts you about mortgage payments you have not made, or someone knocks at your door claiming to be the new owner of the house.

If you no longer have a mortgage on your home or, if you rent out your home to someone else, you might be a target for title fraud because in these circumstances it may be easier for them to use your property title to get a new mortgage or to sell your home.

Foreclosure fraud

Foreclosure is the legal process where a mortgage lender takes possession of a consumer’s home and sells it to cover the mortgage debt the consumer has incurred but has been unable to pay.

In the scenario where a consumer is having difficulty making mortgage payments and facing the possibility of foreclosure, a criminal will take advantage of the situation by offering the homeowner a loan to cover expenses and consolidate loans, in exchange for up-front fees and an agreement to transfer the property title to the criminal. However, in contrast to real debt consolidation programs, the criminal will keep all the payments made by the owner and ignore bills and taxes.

The criminal could also sell the house or re-mortgage it and leave with the money. In the end, the homeowner will lose the home and still be in debt.

Protect your house from real estate fraud

Because most real estate fraud involves some kind of identity theft, to protect your home from real estate fraud, you should protect yourself against identity fraud first. Read FCAC’s tip sheet, Protect yourself from identity fraud.

You can take other actions specifically to protect yourself against real estate fraud.

  • Contact your mortgage lender first if you are having difficulty making your mortgage payments.
  • Consult your lawyer if you wish to give another person a right to deal with your personal assets, and make sure you cancel this right if you don’t need it anymore.
  • Consult your provincial land registry office to ensure that the title of your home is in your name.
  • Check your credit report regularly to ensure the information is accurate. You can get a credit report for free by mailing your request to one of the two credit reporting agencies, Equifax and TransUnion.
  • Consider getting title insurance. Title insurance covers losses related to title fraud and legal expenses to restore a title. There are two types of title insurance:
    • lender title insurance, which protects the lender until the mortgage has been paid off
    • individual title insurance, which protects the homeowner from losses as long as you he or she owns the home, even if there is no mortgage.
Things to do if you are victim of real estate fraud

As soon as you discover that you might be victim of real estate fraud, you should:

  • contact the Canadian Anti-Fraud Centre (CAFC), a national anti-fraud call centre, at 1-888-495-8501 orinfo@antifraudcentre.ca)
  • report the situation to the police, and record the police report number
  • report the fraud to the two credit-reporting agencies, Equifax and TransUnion
  • contact your provincial land registry office as soon as possible. Find out what laws may exist in your province to protect you if you are a victim of real estate fraud. Contact your financial institution. Keep all of the documents that provide evidence of the fraud. Record the name of the person you spoke to at the bank, as well as the date and time you called and when you became aware that you are a victim of fraud.
For more information

For more information on real estate fraud:

Need more information or advice on #mortgage_qualification, contact the The Ray McMillan Mortgage Team

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6 tips to thwart identity theft and fraud

Vigilant online activity, watchful eye on mail can help reduce fraud risk

By Matt Kwong, CBC News Posted: Jan 20, 2015 5:00 AM ET

Meghann Johnston says the last three years have been "incredibly stressful" after her bank account was looted three times.

Meghann Johnston says the last three years have been “incredibly stressful” after her bank account was looted three times. (CBC)

(Note: CBC does not endorse and is not responsible for the content of external links.)

Financial fraud by identity thieves is simpler than victims might suspect, experts warn. But even anti-fraud educators were surprised by the case of Meghann Johnston.

The former RBC customer’s accounts were compromised three times in at least two different branches of the bank, apparently by someone without a client card or PIN who managed to withdraw tens of thousands of dollars.

“It’s an unprecedented story in recent years. I cannot recall anything like this,” said Avner Levin, director of Ryerson University’s Privacy and Cyber Crime Institute.

“That it was in person, that it was done multiple times, and at the same bank, I’m really taken aback,” added Kelley Keehn, a personal-finance expert and author.

Although anti-fraud experts noted that Johnston’s case is rare, they said most consumers can avoid experiencing that kind of stress and financial heartache by adopting some new habits and correcting some bad ones.

Get ahead of the potential problem

It never hurts to give a heads-up to your credit bureau, whether or not fraud has occurred, advised Keehn.

Putting a proactive fraud alert on an account for as little as $5 through TransUnion or Equifax would ensure that anyone attempting to apply for credit in that person’s name would send out a flag alerting the lender to call the applicant directly first.

“If you haven’t been a victim but you’re still scared of all these breaches, you can still get that extra layer of security,” said Keehn, author ofProtecting You and Your Money, a 2014 identity-theft and fraud guide published by the Chartered Professional Accountants of Canada.

Beware of oversharing online

Resist the urge to brag. Vacation announcements, life milestones and financial achievements might be interesting news to share with friends, but it can also entice enemies seeking to exploit your social media activity for their gain.

“Everything you post online tells a story about you. It’s your birthday, or you go to this university, or you post that you just got a line of credit from the bank,” said Athena Mailloux, program co-ordinator for the Fraud Examiners’ program at Humber College.

“A lot of people don’t realize when they’re tweeting out all these bits of information, a fraudster’s job is to troll and put the story together to then become you.”

Don’t neglect your freebies

By law, you’re entitled to one free credit report per year anyway. So why not keep abreast of your credit score? Take the time to go through it in detail. If there is a discrepancy, call the 1-800 number on the back of your debit card and request to speak with identity-theft assistance services.

“That’s free as well, so take advantage of it,” said Mailloux, who owns a practice as a forensic accountant and has helped design identity-restoration services for credit card firms.

“Call the number on the back of your credit card or debit card, and they can refer you to free services where you can just ask general questions about how to protect yourself,” she said.

The Canadian Anti-Fraud Centre also has a toll-free line and a victim assistance guide for consumers who suspect they have been defrauded.

Keep a close eye on the mailbox

If you receive statements by mail, be aware of your billing cycles. It may even be worth logging your bills as they come in and providing a padlock so a postal carrier can lock your mailbox upon delivering mail, lest your statements with your financial details fall into fraudsters’ hands.

If expected mail doesn’t arrive on time, look into it sooner rather than later, said Daniel Williams, a spokesperson with the Canadian Anti-Fraud Centre.

“You’ll spot it way quicker than if you wait around until you smell the smoke and see the fire,” Williams said. “Criminals are very clever at only redirecting one person’s mail in a household so you might not notice the total volume going down to the point where it would be an issue.”

Shop securely online

Stick to trusted online retailers when making purchases online with a credit card. Rob Goodfellow, a former Ontario Provincial Police superintendent who heads the private investigations firm Investigative Research Group, suggests consumers look for signs of secure payment such as PayPal or Verisign.

“I’ve had a PayPal account that’s never been breached, and I always set up an individual account so if somebody does crack into it, they’re only going to get my limited funds in there,” he said. “Keep it outside your mainstream banking.”

Goodfellow also warns shoppers never to make purchases on public or shared computers. Bit if you do, he said, remember to clear the cache and cookies.

Be smart about paper trails and passwords

Don’t leave restaurant receipts on the table, and destroy documents you no longer need.

A paper shredder is a worthy investment, said Bruce Dorris, program director at the Association of Certified Fraud Examiners.

“Everyone should have at least a small one in their house,” he said. “People will leave paper checks on their desk, but somebody can take one off the bottom and it’s not readily identifiable. Be vigilant about your surroundings.”

The same goes for passwords for computers and mobile devices. Dorris suggests changing passwords every month, or at least every three months.

Strong passwords may include a mix of numbers, upper- and lower-case letters and symbols.