http://www.thestar.com/columnists/article/273301

Scam artists make money by preying on jobless

Ellen Roseman
Business Columnist

When Shelley Murphy responded to a work-at-home ad, she had no idea she would end up losing $3,500 from her bank account.

Her story illustrates a new and disturbing trend: Fraudsters who make money by looking for people who are looking for work.

While checking jobs posted on the Internet, she saw an ad for V-Tech Computer Ltd. It was setting up temporary branches in Canada and needed people such as financial controllers, account clerks, marketing and sales representatives to work for $30 an hour.

She checked the company's website, which seemed legitimate, and sent her resumé and references. Soon, she was working as a marketing representative.

She wouldn't allow direct deposit of her wages. Instead, she was sent four money orders of $850 apiece issued by Canada Post.

A month after depositing the money orders, she was told they were counterfeit. By this time, the bank had already emptied her account, taking payments to cover her mortgage and other bills. In fact, she ended up $100 in the hole.

Murphy's bank would not cover her losses. Nor did she get any response from the website where she'd seen the ad, TorontoJobShop.ca, which has disclaimers saying it's not responsible for damages caused by job postings.

Sandra Johnston also fell victim to an Internet job scam. A research and recruiting company called Arini needed partners to do simple banking transactions on its behalf.

She received an $8,500 cheque to take to the bank. Then, she had to wire 90 per cent of the money to two company agents who were waiting to be paid. The cheque turned out to be fraudulent and she now owed the bank $8,500. All her accounts had been frozen.

Johnston, who's on a disability pension, was hoping to find work to supplement her income. Instead, her disability cheque was seized by the bank to cover her debts. "I believe that banks have a responsibility to inform their clients about the possibility of scams when they see a draft for a large amount of money," says Johnston. "The most I have ever deposited is $500."

David Fisher, the ombudsman of TD Canada Trust who is looking into Johnston's complaint, has seen 10 to 15 similar scams in the past two years.

"The profile of the victims is quite similar in that they are financially strapped and not generally able to access the regular job market for age reasons. But they feel capable of working and are usually reasonably intelligent people," he says.

"They get official-looking letters saying they have been hired over a number of other candidates and usually have an employment form to fill out before anything starts."

In a typical scam, companies say they're seeking an agent to represent them in Canada. They're doing business here, but don't have a banking relationship yet.

You are "hired" and told you will be receiving cheques representing the collection of receivables from Canadian customers. You are told to deposit the money into a bank account, keep a percentage as your "pay" and send the rest back to head office.

Usually, you're advised not to tell your bank what the cheques are for and to deposit small amounts (less than $10,000) to avoid regulatory problems.

The cheques eventually bounce and you're the loser, since the money is charged back to your account.

The amounts involved are usually at least $8,000, Fisher says, and often much higher because there are several deposits in a short time.

The fraudsters keep the amounts below what has to be reported under the federal money laundering law, which would trigger long holds on the deposits.

"The banks are really in a hard place here. We are not allowed to push a client to tell us where the cheques come from for federal privacy reasons," he says.

Clients are usually instructed not to tell the bank anything. And when the cheques bounce, they blame the bank for not protecting them – and even worse, for unleashing collections officers on them when there is little chance of them repaying the outstanding amount.

"Collection calls and activities are unpleasant at best and clients see it as the bank making a bad situation worse.

"Through it all, the bank looks like the bad guy having to collect against elderly, poorer clients who are legitimate victims. A real no-win at all," Fisher concludes.

If you're a job seeker, you need to do your own research on companies and ask for names of people who have worked for them. Check with third parties, such as the Better Business Bureau.

Most important, if firms are asking you to conduct payments on their behalf, don't assume they're legitimate – even if their ads appear at a legitimate job website.