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RRSP Loan Scam

A scammer convinces you to use your RRSP savings to buy shares in a company.

How it works

The scam artist tells you that you can take money out of your locked-in retirement account (LIRA) early, without paying tax. The scammer advertises a special "RRSP loan." To get the loan, you have to sell the investments you now hold in your LIRA. Then you use the money in the plan to buy shares of a start-up company the scammer is selling. In return, they promise to loan you back some of the money you invested. He or she will keep the rest as a fee. You are told you will get ready cash, pay no tax on it, and still hold a valuable investment in your LIRA. But, the investment you buy may be worthless. And you may never see the loan. You could lose your retirement savings. In addition, you may also have violated federal income tax law and will now have to pay taxes to the Canada Revenue Agency (CRA) on money you never received.

How to protect yourself

  • In most cases, you have to reach age 55 or older before you take money out of your RRSP. And there are often limits to how much money you can take out each year. Also, you likely will have to pay tax on the money you withdraw. If someone tells you different, it may be a scam.
  • Check that 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.  

How to report it

If you suspect you’re a victim of a RRSP loan scam, or attempted RRSP loan scam, complete the FCNB Submit a Complaint form, contact the Canadian Anti-Fraud Centre, and your local police or RCMP.

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.