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Beware of the Canadian 'granny scam'

These phone bandits have no conscience. They would steal your parents' retirement money without batting an eyelash. And that's just what they're doing with this scam.
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Telephone scammers in Canada love Americans. They also have found that some of us are incredibly easy to fool. If they can concoct a convincing story, they can get people to send them thousands of dollars.

"We’ve always known con artists will stop at nothing to rip off their victims,” says Washington State Attorney General Rob McKenna. “This may be a low point – stealing from seniors by posing as a family member.”

With the “grandparent scam” the caller pretends to be a grandchild in trouble in Canada who needs money immediately. The caller often says he’s been arrested, was in a car accident or had some type of medical emergency.

These phone bandits have no conscience. They would steal your parents' retirement money without batting an eyelash. And that's just what they're doing.

In 2007, the Canadian Anti-Fraud Call Centre received 128 complaints about this scam. Since the beginning of the year, more than 317 complaints were filed, and the majority of those were in July and August.

This deviously clever con is very effective because it catches the potential victims off guard and tugs at their heartstrings.

“I fell for it completely,” says Bill Wilson, 79, of Sequim, Wash., who got taken for $6,500. The caller, who pretended to be his grandson, said he was in jail in Canada.

“I was a little suspicious, but I thought the kid was in trouble,” Wilson tells me. He called the boy’s parents to verify the story, but they weren’t home, so he wired the money.

“They call you with an emotional plea and correctly identify themselves. It’s convincing!” he says.

Charlotte Becker, Wilson’s daughter-in-law, tells me the retired Naval aviator is “one of the shrewdest and most savvy people” she knows. “This must be one slick operation,” she says.

A call out of the blue
A few weeks ago, Jane and J.V. Wilson of Seattle (no relation to Bill Wilson) got an unexpected call from their grandson Mitch. At least that’s what they thought at the time.

“He said he was in trouble. He’d been in a car accident and was being held in a courthouse in Vancouver, British Columbia,” Jane remembers. “They would not let him go until he came up with the money to pay for the accident.”

The con artist pretending to be Mitch said he needed $3,500. He told the Wilsons a bailiff would call back to explain how to wire the money. A few minutes later the phone rang again with a pretend bailiff on the line.

“He said he would take our grandson to a location where he could pick up the money,” says J.V. “And when he got the money, then Mitch could be released.”

A few days later, Jane and J.V. called their grandson to make sure he was OK. Mitch – the real Mitch – told them he hadn’t been to Vancouver. That's when the Wilsons knew they'd been had. By then, the money was long gone, picked up in Montreal.

“When you look back at it now, you feel foolish,” J.V. tells me. “We should have called his mother. But at the time it all tied together. These guys are really good with a story.”

Scam is on the rise
The sort of scam, based on an “emergency situation” has been around for years. But the Canadian Anti-Fraud Call Centre, also known as PhoneBusters, reports a dramatic increase in complaints in recent months – especially those linked to grandparents.

“We’ve seen tremendously high losses, usually $3,000 to $4,000 a hit,” says PhoneBusters’ spokesperson Debbie Bell. But some victims lose much more.

Fall for the scam and the bad guys will call back and try to steal even more by adding a new layer to the story. If the grandparent provided bail money, they may ask for money to repair the car. Or they may call back and say they had an accident on the way home and need money to pay hospital bills.

With this scam, the caller always insists the grandparents don’t tell anyone about the money transfer. That should be a warning flag.

"He just kept saying, 'this is a secret, this is a secret.’ ” recalls Florence Cook of Seattle.

A con artist pretending to be their grandson, Kenny, convinced Florence and her husband Horace (both in their 90’s and living on a fixed income) to wire him $1,000.

“I think it’s terrible,” says Beverly Gettys, the Cook’s daughter. “This was a lot of money to them, plus they were worried all day about their grandson.”

Law enforcement officials aren’t sure about how the scammers get their information. The calls could be random. A con artist could simply say “Hi Grandma” or “Hi Grandpa” when the phone is answered and wait for the victim to provide the name. “Hi Billy, how are you?”

Published obituary notices may be a source of family information.Or they might search blogs or public Web sites, such as Facebook and MySpace.

“It’s incredibly easy to get a huge amount of information about the grandparents from the grandkid’s blog,” says Herbert Thompson, chief security strategist of People Security. “You’ll get all the ingredients you need to go ahead and call someone and pretend to be somebody else.”

So be careful about the personal information you put online – it could be used against you or someone in your family.

Help protect your loved ones
Because they are in another country, it’s hard to track down, let alone prosecute these telephone con artists. They know a lot of tricks to avoid law enforcement.

The way to fight back is to make sure your friends and family members don’t become victims. Explain how the scam works. Tell them to be suspicious of anyone who calls unexpectedly and wants them to wire money – especially to Canada. Make sure they know the right thing to do is to call you or someone else in the family, even if they’re told to keep it a secret.

Jane and J.V. Wilson learned from their nasty experience. The family now uses a password to verify themselves. That’s a smart idea.

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