A scammer builds trust through a shared connection, and then targets you for a pitch.
How it works
Affinity fraud occurs when a scammer targets tight-knit groups such as associations, unions, social clubs, online social networks, and ethnic or religious communities. The scam artist abuses our instinct to trust the people who are like us. Once the connection to the group is understood, defences go down, and one more name is added to the scam artist’s sales column. The scam artist might be a member of your group already, or if not, will try to pull members into the scam by building relationships with important members of the group to gain acceptance.
How to protect yourself
- Check to see if the individual and firm selling the investment are registered in New Brunswick. Use the National Registration Search Tool.
- Get as much written information as possible about the investment. It should include detail about the risks and costs of the investment, and what you have to do to get your money out.
- If you’re unsure, get a financial professional such as an accountant, lawyer or a financial advisor, to evaluate the investment.
- Beware of the use of names or testimonials from other group members. Scam artists usually pay out high returns to the early investors by using money from later arrivals. Because of the great money they’re supposedly making, early investors may be wildly enthusiastic about a scam that may collapse entirely once you've invested.
How to report it
If you suspect you are a victim of affinity fraud, or attempted affinity fraud, complete the FCNB Submit a Complaint form.
FCNB administers and enforces legislation in the mortgage brokers, payday lenders, real estate, securities, insurance, pensions, credit unions, trust and loan companies, cooperatives, and a wide range of other consumer legislation. If your complaint relates to an area outside of FCNB’s regulated areas, we may refer you to the appropriate reporting agency or organization.