There is no denying that technology has made life easier and swifter than ever before. Especially for a small business, technological tools can be a big help and save loads of time in crucial areas such as bookkeeping, accountancy, logistics management, and many more. But there is a dark side to this tech boom—the increase in the number of scams and frauds. What’s worse, with technology having dissolved national boundaries, many scams are often orchestrated from countries far away. There has also been an alarming increase in CRA scams in the past few years, where scammers posing as CRA officials trick businesses into paying exorbitant amounts or even stealing sensitive business information.
How does one protect their small business from falling prey to such CRA scams? How can you identify and report such instances? This article is about that.
Types of CRA Scams
Scammers usually try to create a sense of urgency, even fear, to trick you into parting with confidential information or money. With the advent of Artificial Intelligence and advanced web tools, scammers can even replicate official government logos, websites, and letterheads, making all sorts of communication seem genuine. These scams can take many forms, such as:
- Sending links to fraudulent websites that look almost exactly like the CRA site under the pretext of verifying important information about your small business and even yourself
- Extorting money through fake claims of unpaid taxes
- Offering “limited period” discounts or rebates in taxation to gain sensitive information and money from you
- Posing as CRA officials (complete with fake IDs and phone numbers) and forcing payments through threats.
Despite these seemingly hard-to-see-through scenarios, there are a few things you can do to verify if you’ve been contacted by the real CRA or not.
How Can You Protect Your Business from a CRA Scam?
As mentioned above, most scammers create a sense of urgency and fear, so you don’t get the time to verify if they are from the CRA. So, first and foremost, it is important to stay cautious and keep your cool when you get any suspicious call, text, or email claiming to be from the CRA. The following are some ways you can use to identify and verify if the CRA is contacting you:
Knowledge About CRA Requirements
The CRA will never ask for financial information about your business or yourself in a voicemail or email. They will never use aggressive language or threats of any kind or demand immediate payments using cryptocurrency, prepaid credit cards, or e-transfers. And they will never ask you to meet them informally or unofficially in a public place to collect money. Any such requests via any medium – email, text, or phone call – should immediately be terminated and reported.
Verifying Phone Numbers
CRA officials will always identify themselves by sharing their names and contact numbers with you. If suspicious, note down the details and terminate the call. Then, use the Verify Phone Number tool available on the CRA website to check if the number is legitimate. Please do not trust any numbers displayed on the caller ID, and do not, at any cost, share any information before making sure it is the CRA contacting you.
Avoiding Fishy Links
Scammers often send emails from official-looking email IDs to small business owners with a link to fraudulent payment gateways or e-transfer portals. Avoid clicking on such links without verifying if the CRA has tried contacting you. For this, you can always contact the CRA directly from the numbers listed on their website.
Staying Informed
Your ignorance is a boon to the scammer. The Canadian Anti-Fraud Centre and the CRA regularly post updates about the latest scams and what to do if you happen to fall victim to one. Subscribing to such alerts can help you identify scams immediately and report them to the authorities.
Securing your Business Data
Using reliable security measures to keep your data safe and backed up can help reduce the risk of your business data falling into the wrong hands. Invest in a sound security system and protect any passwords to prevent your small business’s financial information from getting hacked.
Hiring a Trusted Accounting Agency
While hiring an experienced and trusted accounting agency to handle your business accounts has many perks, one of the significant advantages of doing this is that these experts can also guide you on protecting valuable financial information from potential fraud. Backed by years of experience and a network of contacts, they can help you with the best and most secure technology for your business. Some financial institutions and accounting firms offer their own fraud monitoring and protection services.
Despite all this caution, if your business does fall prey to any scam, contact the local police, CRA, and Canadian Anti-Fraud Centre immediately. Notify your bank and block access to credit cards or other financial resources to prevent further loss.
No business is ever completely safe from the risk of scams. However, staying vigilant, informed, and in touch with the CRA’s guidelines on financial fraud can minimize the risk of your small business becoming a victim.
Contact McCay Duff LLP in Ottawa to Help You Protect Your Small Business from Scams
A professional accountant can be your point of contact if ever you face a CRA scam. You can always cross-verify the details with the accountant and leave the CRA communication to them. At McCay Duff LLP, our accountants and tax advisors can provide services such as handling taxes and representing you in CRA inquiries. To learn more about how McCay Duff LLP can provide you with the best accounting and taxation expertise, contact us online, by telephone at 613-236-2367, or toll-free at 1-800-267-6551.
