Fraudsters are targeting Canadian taxpayers by posing as agents from the Canada Revenue Agency (CRA), either by telephone, mail, text message, or email. These phony communications can be disconcerting if you are on the receiving end. To protect yourself and your finances, you need to know how to recognize a scam and distinguish it from a legitimate CRA communication.
As these criminals become more brazen and technologically savvy, the need to protect your personal information — such as your social insurance number (SIN), credit card number, bank account number, and passport information — becomes an even bigger priority for Canadians.
Identifying fake communications
Scammers will often use language that is aggressive, threatening and, most importantly, designed to scare you into paying fictitious amounts. To prevent you from falling victim to this type of fraud, here are some points to consider if you receive any sort of communication that purports to be from the CRA:
Don't be surprised if fraudsters call your home, business, or cell phone and tell you that you owe a large amount of unpaid taxes. To coerce you, they may even say that a criminal tax case has already been filed against you and urge you to call back on a fictitious hotline to avoid dire consequences. Often, the fraudsters demand that you provide them with your personal information or money in an unreasonably short time frame. This gives you little time to evaluate the legitimacy of their requests.
Recently, a new twist on this type of scam has criminals impersonating government agencies other than the CRA, including local police enforcement, to try and trick you into disclosing personal information or transferring money. Similar to the above, victims first receive a call from someone claiming to be from the CRA, who might tell them that there is an outstanding tax liability or that their SIN has been used for fraudulent activity and that they are currently under investigation by the authorities. This call is quickly followed up by a second incoming call from another co-conspirator claiming to be a police officer with knowledge of the ‘case' against the victim. To add further confusion, the incoming number that displays on the caller ID is that of either the local police services or the RCMP. The victim is then persuaded by the ‘officer' to make an immediate payment in order to avoid a warrant for their arrest, frequently in a digital currency such as bitcoin.
If you do receive a suspicious phone call that appears to be from the CRA, or from any another government agency or police service, don't rely on the caller information being displayed on your phone as proof of the caller's identity. Keep in mind that these types of scammers will frequently use caller ID spoofing, which allows them to disguise their identity by falsifying the information transmitted to your caller ID display. If you suspect that an incoming call is a scam, don't hesitate to hang up and call the CRA, government agency, or police service directly. As well, remember that if you do receive a phone call or voice message saying that you owe money to the CRA, or that you are under investigation by a government agency for a matter related to your tax return or SIN, you can confirm the validity of this information by directly calling the CRA or government agency. Additionally, you can check for any amounts owing to the CRA online using the My Account service. You should never provide any personal or financial information to the caller or leave it on an answering machine.
Phony communications by way of mail, text, or email often urge taxpayers to visit a fake CRA website where they are asked to verify their identity by entering personal and financial information. Other fake communications may promise bogus tax refunds that can only be claimed after clicking on a link to a fraudulent website. If you do receive a text message or an email purporting to be from the CRA or other government agency containing any links, do not click on them. These criminals may be using a technique known as phishing to steal your personal information when you click on the link.
You should note that the CRA will only send an email containing links while their agents are on the phone with a taxpayer who has called to request a form or a link to specific information.
The CRA will never:
- send an email with a link and request that you divulge personal or financial information;
- use text messages or instant messaging applications to communicate under any circumstances;
- demand immediate payment by Interac e-transfer, a digital currency (such as bitcoin), prepaid credit cards, or gift cards.
Remember that if you have signed up for online mail (available through My Account, My Business Account, and Represent a Client), the CRA will send a registration confirmation email to the address you provided for online mail service. The CRA will also send an email to the address you provided to notify you when new online mail can be viewed in the CRA's secure online services portal.
How you can respond
If you think that your CRA user ID or password has been unlawfully accessed, be sure to immediately contact the CRA. If they are able to confirm that your information has been compromised, they will act to ensure it is not used with CRA systems and processes. You can also ask the CRA to disable online access to your information on the CRA login services.
If you have unwittingly given out your personal or financial information as a result of fake CRA communications, contact your local police service.
Protect yourself
To help you properly identify scams, the CRA has posted samples of the more common ones, as well as transcripts of fraudulent communications, on their website. When it comes to communications from the CRA, exercising caution and ensuring that you never provide personal information online, by email, or over the phone can help protect you from fraud. Whether it is the promise of an unknown refund amount or the threat of legal action for an unpaid tax liability — if it doesn't seem right to you, it probably isn't, so trust your own judgment.
If you do receive a suspicious phone call, text or email purporting to be from the CRA, do not hesitate to contact your BDO advisor to help you determine whether the CRA is in fact trying to get in touch with you.
BDO can help
Learn more about BDO's Canadian Tax ServicesThe information in this publication is current as of January 7, 2020.
This publication has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only. The publication cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information contained therein without obtaining specific professional advice. Please contact BDO Canada LLP to discuss these matters in the context of your particular circumstances. BDO Canada LLP, its partners, employees and agents do not accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this publication or for any decision based on it.