Last December, the Ontario Energy Board reported a 77 per cent increase in reported energy scams from 2020 to 2022. That includes everything from text messages and phone calls from people claiming to work for legitimate hydro companies and demanding payment for “late” or “missed” bills, to social media ads claiming to offer rebates and lower electricity prices—and everything in between. The Canadian Anti-Fraud Centre (CAFC) classifies utility-related frauds as a type of extortion fraud, where scammers threaten to turn off someone’s power if payment isn’t made immediately for unpaid hydro bill balances. They might ask for payment via money service businesses, pre-paid cards, or even Bitcoin. John Armit, the acting detective sergeant at the CAFC, says energy-related scams can take various shapes and forms, but at the end of the day the goal is the same: “They just want your money.”
This year, from January to September, the CAFC received more than $6.1 million in reported losses associated with extortion frauds, and over half were reported in Ontario. December is a particularly troublesome month for utility scams, warns Toronto Hydro, so we asked Armit how cottagers can stay alert, aware, and ultimately protect themselves from falling victim to utility fraud.
Why is December considered a prime time for utility-related scams?
My guess is that it’s connected to the colder weather. Fraudsters will tell victims there’s a balance on the hydro bill owing, and that payment needs to be made urgently or the power will be turned off. You don’t want to have your hydro turned off in the cold, especially if you’re going to host a family event, or you’re going up to your cottage.
Hydro disconnection seems especially threatening to cottagers who aren’t at their properties in the winter and are worried about frozen pipes and other issues. Not to mention those who rent out their properties over the winter.
Exactly. Scammers rely on that worry, that psychological trigger. It’s a scare tactic, and it’s all part of the plan. They want to throw people off and disrupt what would normally be a prudent mental thought process. Maybe you’re worried your pipes will freeze or your renters will be without heat. Maybe you have a freezer full of hundreds of dollars worth of food that will now perish. All of these things flood into people’s minds and I think that’s what causes victims to react where they normally wouldn’t.
It seems like utility scams rely on a sense of urgency too. Is that one way cottagers can differentiate between fake hydro calls and real ones?
Absolutely. Utility fraudsters might say that your hydro will be disconnected instantly if you don’t pay up now. Most companies wouldn’t threaten immediate disconnection, so that’s an instant red flag.
What’s the most common type of utility fraud that cottagers should look out for?
There really isn’t one. Like I said before, fraudsters want your money, so that’s going to be at the heart of all of these types of scams, whatever the method. They’re going to want it urgently, and a lot of times scammers will contact you out of nowhere. It’s unsolicited. Hydro One has a pretty extensive list of different types of utility fraud examples and pitches, and I would encourage everyone to familiarize themselves with that list. Fraudsters are creative, and they spend a lot of time and energy thinking about how to get money from people as quickly and easily as possible.
How can cottagers protect themselves from falling for utility scams?
We always say, “take five and tell two.” If someone is calling you claiming to work for a legitimate hydro company and you sense something is off, hang up the phone immediately, take a five minute break and tell two people. This gets you out of that state of panic and into a more clear-minded space where you can better assess the situation. The same applies if you get a text with a link asking to submit payment, or offering a hydro deal. Taking that extra moment to pause before moving forward could save you a lot of trouble down the line.
If it’s a phone scam, go directly to your hydro company’s website and verify their phone number. Does it match the number that called you? You can also call your hydro company via the verified number on their site and tell them what’s being asked of you and go from there. Most hydro companies also have live chats that you can use. Another option is to simply check your online hydro account to see if you’re actually in arrears, or whatever the scammer is claiming.
What about utility-related scams over text, email, or on social media?
If you’ve been texted and there’s a link involved, look at the URL. Is it composed of a bunch of random alphanumeric figures? That’s a good clue it’s a scam. Also, ask yourself if your hydro company would ever contact you by text message. Chances are they wouldn’t.
If it’s an email or social media post advertising a false rebate program, look at the email address and social media account. Usually there will be extra numbers or letters. So instead of hydrocompany.com, it might be, hydrocompany111.com.
What should cottagers do in the unfortunate event that they do fall victim to utility fraud?
The first step is to gather all information pertaining to the fraud. This could be screenshots of texts or emails, any documents or receipts showing payments that you’ve made, that sort of thing. Next, report the incident to your local police and remember to take down the name of the officer you spoke to and your incident number for reference. You’ll also want to report the event to the Canadian Anti-Fraud Centre either by phone or through our online reporting system. If there was any type of money transfer, you need to notify your financial institution. If money was sent through an online provider like Western Union or PayPal instead, report the event through that specific platform. If it was a social media ad that you clicked on, report that post as spam through that social media provider as well.
Finally, if any identification was compromised, like a passport or driver’s license, or bank account information, victims should place flags or fraud alerts on their accounts through the credit bureaus of Canada, Equifax, and TransUnion. This notifies creditors to take extra steps to verify your identity before extending credit. You’ll also want to get new identification right away if that was compromised, whether it be a driver’s license, passport, or health card.
Utility fraudsters can show up at your door claiming to work for legitimate hydro companies too, right?
They can. Again, these scams will often be unsolicited, but the approach might be different. One example is that they might say they need to do an assessment to see if you’re eligible for a brand new heating tank, air conditioner, or heat exchanger, and that you could get a credit from the government. They’ll get you to sign some sort of false contract, and then after the fact, they’ll do some sort of follow up where there’s more documentation. Maybe they say they can renovate for an additional rebate. What the victim doesn’t realize is that they’re actually signing over the deed to the property, essentially, which can lead to liens and other very serious problems for the property owner.
What should cottagers do in that scenario?
Always ask for identification, and beyond that, don’t let the person in. You might dismiss them, shut the door, and then call your hydro company to investigate. If your hydro company needs to come to your home, you’ll likely be notified ahead of time.
Who are utility fraudsters targeting?
Scammers in general will target anyone and everyone, regardless of social or economic status. That being said, senior citizens tend to lose about 33 per cent more than the average person. Regardless, though, everyone is a target, that’s why it’s important to stay up-to-date on current fraud trends and report any fraudulent activity you may encounter. It’s estimated that only five to 10 per cent of victims report these types of frauds to the CAFC or law enforcement, so the reporting piece is more important than ever if we want to disrupt this kind of behaviour. It’s a collective task.
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