Evidence of meeting #36 for Industry, Science and Technology in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was information.
A video is available from Parliament.
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
It is.
To clarify that, to some extent it's being done in regions. It's not only us producing the fraud awareness piece. For example, we've worked with my colleagues in B.C. They have put posters and pamphlets into multiple languages to alert people of the danger of using a cryptocurrency bank machine, so information is being translated into multiple languages in some regions. It's on a very regional basis, but of course there are always areas where we could improve on that front.
October 3rd, 2022 / 11:50 a.m.
Director General, National Cybercrime Coordination, Royal Canadian Mounted Police
If I could just quickly add—
Director General, National Cybercrime Coordination, Royal Canadian Mounted Police
Yes, part of it is the translation, but we also have to take a holistic view that culturally it might not be the translation. In the approach you take in trying to get the information out there and engaging new Canadians or indigenous communities and people like that, you've got to find the right approach in how you get that prevention message out, considering what resonates with them and how they want to hear and receive that information.
Liberal
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
Thank you, Mr. Chair.
I also thank the witnesses.
Mr. Lynam, earlier you used the words “pervasive and enduring challenge”. As I understand it, this is a persistent challenge. Let us be clear: today's technologies mean that this challenge will remain, inevitably.
Knowing this, what are your goals?
Earlier you mentioned that fraud losses were $379 million and recovery was $3.4 million. Can we link these two figures? The recovery is not even 1% of the losses.
Is this possible? Is my calculation correct?
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
Recovering money from fraud will certainly always remain a challenge, as the fraudsters' model is very adaptive. Once a barrier or safeguard is established, the fraudster will certainly work hard to circumvent those measures. We see it every day: new frauds surface and old frauds are brought back to life. Prevention remains the key to curbing fraud. As you can see, the amounts recovered or returned to victims are far less than the losses reported.
Indeed, when money is transferred to a fraudster, the fraudster will move it around quite quickly. In the majority of situations, when a bank transfer is made, the funds disappear to other accounts within the same day. So the trail fades fairly quickly.
This is why people need to understand that when faced with a fraudulent request, they need to take a step back, to avoid transferring money to fraudsters. Time is on their side. Unfortunately, when the transfer is made, the hill to climb to recover the funds can be very steep.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
Mr. Larocque, you said earlier that you use volunteers, people who work in telecommunications, to help you set up ways to improve your kinds of research.
Do you use the services of hackers? Do you hire people who were once active on the dark web and have advanced technological knowledge? These people have the skills of the fraudsters, but they would be there to help you and prevent it from happening again.
It's a funny question, but I think...
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
Actually, that is a very good question. I'm going to let our director answer it, so he can also tell you about one of our sub-units related to cybercrime.
Director General, National Cybercrime Coordination, Royal Canadian Mounted Police
I would say we don't use hackers or cybercriminals, but interestingly, there are good lessons to be learned in terms of their activities and how they conduct their criminal activities or what have you.
By learning that, you can then make your systems harder or figure out how someone got into a system and then adopt the appropriate prevention approaches. There's actually an industry out there involving penetration testing, a service that companies offer. They'll try to get into a network, and in those cases, those penetration testers usually have to fall under a pretty tight regime.
We have to be a little careful, but we can learn lessons from how hackers operate. We learn them and try to incorporate them into how we protect and follow up.
Conservative
Liberal
The Chair Liberal Joël Lightbound
Mr. Généreux, your time is up. Thank you.
Mr. Erskine‑Smith, you have the floor for a few minutes.
Liberal
Nathaniel Erskine-Smith Liberal Beaches—East York, ON
Thanks very much.
My first question is in relation to some of the numbers on the CAC's website. The dollar amounts seem to track in 2022 to where we were in 2021, with well over $300 million lost so far, and are on track to maybe even exceed last year's numbers, but the number of victims of fraud seems to be tracking much lower. I wonder how you could explain that.
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
The answer is that on average, losses for victims have increased. There are trends with fraudulent investments, mostly related to crypto sectors like bitcoins or any use of cryptocurrencies, whereby scammers—
Liberal
Nathaniel Erskine-Smith Liberal Beaches—East York, ON
Is there an explanation, not for the disparities, but for why we see a lower number of victims?
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
Yes. It's because the losses are higher, on average, for victims. We have fewer victims reporting much greater losses. That can explain why—
Liberal
Nathaniel Erskine-Smith Liberal Beaches—East York, ON
No, I'm not asking about the disparity; I'm asking if we're seeing greater success. Is there something you can point to that says we've been more successful, and therefore we see a lower number of victims?
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
No, sorry. I don't have a specific correlation to that.
Liberal
Nathaniel Erskine-Smith Liberal Beaches—East York, ON
Okay.
[Technical difficulty—Editor] measures, have they been successful?
Acting Officer in Charge, Canadian Anti-Fraud Centre, Royal Canadian Mounted Police
I'm sorry?
Liberal
Bloc
Sébastien Lemire Bloc Abitibi—Témiscamingue, QC
Mr. Chair, on a point of order.
There is a sound problem that makes it difficult for the interpreters to work, so I would like that to be taken into account, please.
Liberal
Nathaniel Erskine-Smith Liberal Beaches—East York, ON
[Technical difficulty—Editor] The STIR/SHAKEN measures, the very measures that were part of our 2020 report [Technical difficulty—Editor] that came forth thereafter, I'm wondering how successful they've been—
Bloc
Sébastien Lemire Bloc Abitibi—Témiscamingue, QC
I'm sorry to interrupt you, Mr. Erskine‑Smith, but the interpreters can't do their job because the internet connection isn't good enough.
NDP
Brian Masse NDP Windsor West, ON
I think you were asking about STIR/SHAKEN and whether that's been successful. Is that correct, Nate?