Commercial Crime Branch

Fraud investigations in the first instance remain the responsibility of the police service or investigative agency of primary jurisdiction. However, Commercial Crime Sections may assume, or may be directed to assume investigative responsibility in cases of major fraud.

Major fraud within the Commercial Crime Program mandate can be defined as fraud cases of provincial, national or international significance (having due regard for contractual obligations with the provinces) in which one or more of the following elements are present:

• one or more of the RCMP strategic priorities (i.e. Organized Crime)
• substantial value or financial losses
• substantial impact on victims
• high degree of criminal sophistication
• requirement for special investigative expertise
• municipal, provincial, or federal governments as victim
• satisfying public or national interest

The RCMP Commercial Crime Sections work closely with the financial community, other law enforcement agencies and government to educate, prevent and investigate major fraud.

Several different types of fraud fall under Major Fraud within the Commercial Crime Program mandate. Some of these are as follows: corporate fraud, investment fraud, securities fraud, mass marketing fraud, credit fraud.

• Corporate Fraud - can include fraud by or against a company. Fraud against a company can happen through misappropriation of corporate assets by a company senior officer or by staff. Criminals use numerous methods to defraud companies for whom they work. These include fictitious revenues, concealed liabilities and expenses, and asset or revenue understatements or overstatements. Fraud by a company may be committed by providing incorrect or misleading information to shareholders or regulators, including financial reporting fraud – where incorrect or misleading information is provided for individual financial gain.
  
  
• Credit Fraud - may occur when fraudulent statements or other deceptive practices are made to a lender in order to secure financing. The exact method used varies from occurrence to occurrence. Fraudulent practices to secure financing for real property is often referred to as mortgage fraud.
  
  
• Investment Fraud - is any fraud associated with investments impacting a person or company. Fraudulent investment schemes are often marketed by telephone salespersons using high-pressure selling techniques. Many of these criminals surround themselves with the trappings of legitimacy such as rented office space, a receptionist, investment counselors, and professionally designed colour brochures describing the investment. High-yield investment fraud occurs when unrealistic returns are promised in return for investment in these schemes.
  See: http://www.rcmp.ca/scams/prime_bank_e.htm
  
  
• Securities Fraud - Securities investing and trading is carefully regulated by rules and laws for the protection of public investors. The violation of these rules, particularly through various deceptive actions and schemes to cheat or take advantage of investors, is commonly known as securities fraud. The RCMP receives securities fraud complaints such as suspect investment schemes, insider trading, market manipulation, and any inappropriate or suspected illegal activity of market participants for evaluation, possible investigation, and / or referral to a partner investigative or regulatory body.
  
  The RCMP helps protect the public interest by seeking to prevent unfair, improper or fraudulent acts against investors, corporations, and the public at large, to ensure market integrity. In cooperation with its partners, the various provincial and territorial securities commissions, and both public and private regulatory agencies, the RCMP conducts investigations related to securities fraud.
  
  Through various communication vehicles, the RCMP informs the public of fraudulent securities investment schemes, which helps in prevention and gaining public awareness about such criminal activities.
  
  
• Mass Marketing Fraud - is fraud committed over communication media, namely: telephone, mail and Internet. Mass marketing fraud is an enormous global problem and criminals make use of jurisdictional borders to increase the complexity of their criminal activities. Some of the more common schemes used to defraud victims are: fraudulent prize and lottery schemes, fraudulent loan offers and credit card schemes.
  
  The RCMP has undertaken a joint task force / integrated approach with our partners to combat the problem. In 2001, the RCMP joined PhoneBusters as a full partner with the Ontario Provincial Police. Examples of integrated projects that involve domestic and international partners are projects COLT (Montreal) and EMPTOR (Vancouver). These alliances have been successful in identifying and arresting international criminals.
  
  The Internet is becoming a medium of choice for mass solicitation by these types of criminals. Internet based fraudulent solicitations originating from West Africa are reported to PhoneBusters at a rate of 1000 to 1500 per day. Partners continue to better educate and safeguard Internet users. This is driven by a guarded approach - "Recognize it, Report it, Stop it." If people believe they have been a victim of mass marketing fraud, they can lodge complaints through their local police detachment, Reporting Economic Crime On-Line (RECOL) or PhoneBusters at 1-888-495-8501.