Fraud is costing you, even if you’re not the one getting scammed

For this week’s No More Ls column, we’re looking at how much fraud costs Canadians, how sophisticated scams and identity theft are today, and one important thing you can do.

Scam fatigue is a real thing and it has real consequences. According to the experts I spoke with, we hear so much about identity theft and scams, and how to prevent them, that we can become numb to these crimes—even though we’re all targets. The key here is awareness, instead of resignation or defeat. Here’s how fraud affects all of us and some scams to watch out for. 

How much do scams cost Canadians?

The cost of fraud is expensive, and it’s rising. From $530 million in 2022 to over $704 million in 2025, scammers are making a killing. And that’s only a fraction of the real total, as the Canadian Anti-Fraud Centre (CAFC) estimates that only between 5% and 10% of incidents are even reported. These bad guys are generating so much income from people around the world that the New York Times calls it a “secretive, highly fortified industry.”

The costs aren’t just the money that is stolen and the emotional impact on victims. Fraud also means more expensive products and services for all Canadians. The price of additional security infrastructure trickle down to the customer, of course. Companies hire external security firms and in-house teams, while also paying for software, insurance and more, says Jeff Taylor, the CEO of OTH Security, based in Vancouver. On your end, that looks like inflation—with additional fees, other charges and price tag increases. 

Picture it this way, says Anne-Marie Kelly, a Toronto based advisor for fraud, identity and financial crime strategy. “You know how every time insurance claims are made, our insurance policies as consumers start to go up. The costs to the banks of writing off fraud, skip tracing, or finding the perpetrators equates to higher fees. It all comes back to the consumer at the end of the day.”

The most expensive scams and identity theft tactics

Inflation isn’t the only thing to blame rising costs on; scammers are driving prices up too. According to Kelly and Taylor, here are the costliest scams on the rise right now. 

• Mortgage fraud: This is when people misrepresent themselves on mortgage applications to get approved, but ultimately don’t make payments. Lenders pass these costs onto existing customers, says Kelly. The Bank of Canada rate isn’t the only thing affecting the interest Canadians pay on their mortgages.
• Car loans: Through personal connections, this organized criminal activity works like a pyramid. The targets are asked by fraudsters—people the targets know and trust—to help them get a car loan. The car ends up in a shipping container, and the “friend” or even “partner” is never to be seen again and certainly doesn’t pay off the loan. “I’ve seen the instances of this type of fraud increasing every month in the Vancouver area,” says Taylor. The costs to lending institutions get passed on through higher interest rates. At the same time, stricter credit requirements make it more difficult for everyone to finance a car purchase.
• Fraudulent activity on an account: Even Taylor paused when he got a notification to check his bank account for fraudulent activity. He realized it was a scam, but “They’re incredibly well spoken. They’re very savvy. They know all the right acronyms. They know how to prey on fear and urgency.” This has led financial institutions to create large departments with machine-learning fraud detection, behavioural transaction monitoring, and data-sharing networks between banks. As well, institutions have to be compliant with Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) requirements, Know-Your-Customer (KYC) rules and anti-money-laundering legislation. Who pays the bill for that? You guessed it. 
• ID selling: People hoping to make a quick buck might sell their driver’s licence, student card or other forms of ID. “Due to the macroeconomic times, Canadians are selling their IDs to the scammers,” says Kelly. “We’re seeing an increased trend.” These IDs are sold to crime organizations or used for fraudulent credit applications. Who pays the bill for this? You’re right again.
• AI digital injection attacks: “AI, the two letters in the alphabet that everybody seems to be talking about,” says Kelly. What AI can do is impressive, but often not in a good way. In addition to deepfakes (manipulating images, videos and voices to mimic real people), scaling fraudulent emails and texts, scouring the web for info about real people from their social media profiles and posts, AI is now being used to verify fake driver’s licences, and deepfakes have even held passports.

The result of all of these scams “comes back to increased fees to the consumer, whether that’s from the lenders, insurance, or our budgets for governments supporting law enforcement,” says Kelly. “It all comes back to the general consumer to pay for these crimes.” (Find out if how to tell if an AI investment is a scam.)

One thing you must do to put scams on pause 

While the finance world is amping up its security teams and tools, you can avoid scam fatigue by being aware. “People are generally pretty intelligent, but they’re just not informed of this space enough to catch those scams,” says Taylor. 

While it’s tough to keep on top of every scam when it’s not your job, approach all requests by taking “a beat,” he adds. Whether you’re at work or on your own personal device, look at every request critically, especially if it makes you feel stressed at all. The scammers don’t want you to think—they want you to feel like you don’t have any time. If someone is making you feel like you must act now, you probably should do the opposite and pause for a minute.