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Financial Fraud in Canada

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Financial Fraud in Canada
FINA 402 – Short-term Financial Management Term Project Financial Fraud in Canada

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Analysis presented to
Ms. Julie Slater by Anouck Cinq-Mars (9197710)
Anthony Liscio (9097856)
Angelo Vaccaro (9356290)
Joe Vincelli (9234403)
Kyle Zarmair (9055177)

John Molson School of Business
April 4th 2011

Table of Contents

Evolution of financial fraud in Canada…………………………………………...……4

Current types of fraud Canadian financial institutions
A) Internal fraud…………………………………………………………………………..5 Identity theft……………….……………………………………………………….6 Illegal insider trading………………………….…………………………………...7 Wire fraud…………………………….……………………………………………7 Bank fraud…………………………….…………………………………………....8

B) External types of fraud…………………………………………………………………8 Debit and credit card fraud……………………………………………………..…9 E-mail fraud/phishing……………………………………………………………10 Identity theft and Title fraud……...……………………………………………...10

C) Investment Fraud: Ponzi Scheme……………………………………………………..11 History of the Ponzi Scheme……………………………………………………..11 Recent financial scandals…………………………………………………….......13 Ponzi Schemes and Market Regulation………………………………………….14

Organized crime and financial crimes
A) Organized Crime in Canada……..…………………..………………………………..15
B) Money laundering………………………..…………………………………………...16
C) Mortgage fraud………………………………………………………………………..17
D) Market Securities fraud……………………………………..………………………...18

Effects of fraud in Canadian financial institutions
A) Economic implications……………………………………………………………….19
B) Public implications……………………………………………………………………21

Future Challenges………………………………………………………………………22

Bibliography……………………………………………………………………….……24

Exhibit 1…………………………………………………………………………………27

Exhibit 2…………………………………………………………………………………27

Exhibit 3…………………………………………………………………………………27

Exhibit 4…………………………………………………………………………………28

Exhibit 5………………………………………………………………………………...28


Bibliography: Asian Development Bank. "What is money laundering?." Asian Development Bank. N.p., n.d. Web. 31 Mar. 2011. . "Autoritédes marchés financiers." Autorité des marchés financiers. N.p., n.d. Web. 3 Apr. 2011. . Bloomberg Businessweek. "The Greatest Financial Scandals: Charles Ponzi - BusinessWeek." BusinessWeek Slide Shows and Multimedia . N.p., n.d. Web. 3 Apr. 2011. . Canada Intelligence Service Canada. "2010 Report on Organized Crime." Criminal Intelligence Service Canada. N.p., n.d. Web. 31 Mar. 2011. . Canadian Bankers Association. "E-mail Fraud/Phishing." Canadian Bankers Association ? Association Des Banquiers Canadiens. N.p., 1 Apr. 2009. Web. 3 Apr. 2011. . Canadian Bankers Association. "Credit Card Fraud." Canadian Bankers Association ? Association Des Banquiers Canadiens. N.p., 28 May 2009. Web. 3 Apr. 2011. . Canadian Bankers Association. "Real Estate Fraud." Canadian Bankers Association ? Association Des Banquiers Canadiens. N.p., 24 Nov. 2009. Web. 3 Apr. 2011. . Canadian Bankers Association. "Debit Card Fraud." Canadian Bankers Association ? Association Des Banquiers Canadiens. N.p., 10 Mar. 2010. Web. 3 Apr. 2011. . Canadian Mortgage Trends. "Canadas Biggest Mortgage Fraud." Mortgage Rates & Mortgage Broker News in Canada. N.p., 9 May 2010. Web. 3 Apr. 2011. . Canadian Press. "Earl Jones gets 11 years for $50M fraud." CBC News Canada. N.p., 15 Feb. 2010. Web. 31 Mar. 2011. < http://www.cbc.ca/news/canada/montreal/story/2010/02/15/earl-jones-sentenced-ponzi.html >. "Charles Ponzi - Wikipedia, the free encyclopedia." Wikipedia, the free encyclopedia. N.p., n.d. Web. 3 Apr. 2011. . Criminal Intelligence Service Canada. "Criminal Intelligence Service Canada." Welcome Page | Page d 'accueil. N.p., n.d. Web. 3 Apr. 2011. . Criminal Intelligence Service Canada. "Mortgage Fraud & Organized Crime in Canada." Welcome Page | Page d 'accueil. N.p., n.d. Web. 3 Apr. 2011. . Department of Justice Canada. "A Typology of Profit-Driven Crimes ." Welcome Page | Page d 'accueil. N.p., n.d. Web. 3 Apr. 2011. . Fletcher, Richard. "SEC failed to inspect Bernard Madoff fund." The Telegraph. N.p., n.d. Web. 31 Mar. 2011. . Henault, Richard. "Scandal Norbourg: l 'AMF contrainte de payer." Cyberpress.ca. N.p., 9 Nov. 2010. Web. 31 Mar. 2011. . "Total Interac Direct Payment Transactions." Interac. N.p., n.d. Web. 3 Apr. 2011. . "Interac." Interac. N.p., n.d. Web. 3 Apr. 2011. . "Interac 2009 Statistics." Interac. N.p., n.d. Web. 2 Apr. 2011. . "Internal Fraud Law & Legal Definition." Legal Definitions Legal Terms Dictionary. N.p., n.d. Web. 3 Apr. 2011. . Investopedia. "CFA Level 1 - Ethics and Standards." Investopedia.com - Your Source For Investing Education . N.p., n.d. Web. 3 Apr. 2011. . King, Mike. "Vincent Lacroix pleads guilty." Global News. N.p., 21 Sept. 2009. Web. 31 Mar. 2011. . "MasterCard Introduces Chip." MasterCard. N.p., n.d. Web. 1 Apr. 2011. . McFarland, Janet. "More protection urged for mutual fund investors - The Globe and Mail." Home - The Globe and Mail. N.p., 10 Mar. 2011. Web. 3 Apr. 2011. . "Methods and Stages in Money Laundering." The University of Exeter - People Homepage. N.p., n.d. Web. 3 Apr. 2011. . Moffatt, Mike. "What is a Ponzi Scheme - How Do Ponzi Schemes Work." Economics at About.Com -- Your Portal to the World of Economics. N.p., n.d. Web. 3 Apr. 2011. . "Norbourg scandal." Wikipedia. N.p., n.d. Web. 31 Mar. 2011. . Royal Canadian Mounted Police. "Identity Theft and Identity Fraud." Royal Canadian Mounted Police - Welcome | Gendarmerie royale du Canada - Bienvenue. N.p., n.d. Web. 3 Apr. 2011. . Royal Canadian Mounted Police. "Counterfeiting and Credit Card Fraud." Royal Canadian Mounted Police - Welcome | Gendarmerie royale du Canada - Bienvenue. N.p., n.d. Web. 3 Apr. 2011. . Royal Canadian Mounted Police. "E-mail Fraud / Phishing ." Royal Canadian Mounted Police - Welcome | Gendarmerie royale du Canada - Bienvenue. N.p., n.d. Web. 3 Apr. 2011. . "Seven signs of internal fraud." PwC US: Building relationships, creating value. N.p., n.d. Web. 3 Apr. 2011. . TD Bank Financial Group. "TD Bank Financial Group - Privacy and Security - Phishing." TD Bank Financial Group. N.p., n.d. Web. 3 Apr. 2011. . The Economist. "The Madoff affair: Con of the century | The Economist." The Economist - World News, Politics, Economics, Business & Finance. N.p., n.d. Web. 3 Apr. 2011. . The Economist. "Ponzificating: is the financial system a confidence trick?." The Economist. N.p., 15 Mar. 2007. Web. 31 Mar. 2011. . The Federal Bureau of Investigation. "FBI — Common Fraud Schemes." FBI — Homepage. N.p., n.d. Web. 3 Apr. 2011. . The Federal Bureau of Investigation. "FBI — Common Fraud Schemes." FBI — Homepage. N.p., n.d. Web. 3 Apr. 2011. . U.S. Securities and Exchange Commission. ""Ponzi" Schemes." U.S. Securities and Exchange Commission (Home Page). N.p., n.d. Web. 3 Apr. 2011. . "Visa Chip Cards." VISA. N.p., n.d. Web. 2 Apr. 2011. . "bank identity theft." bank identity theft. N.p., n.d. Web. 3 Apr. 2011. .
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