Rising credit card scams impacting Canadian retailers

Retailers across Canada are facing mounting pressures as a wave of credit card scams sweeps through the industry, leading to significant financial losses.

“Scammers will contact usually small businesses in and around Nova Scotia and make large purchases of things like tires, furniture, generators, ATVs [and] that kind of thing,” said Const. Mitch Thompson, Nova Scotia RCMP officer.

According to the Retail Council of Canada, credit card scams have been a problem for the last three years and impacts retailers’ bottom line.

“It’s the retailer that’s on the hook when there’s fraud done through the use of credit cards. It’s really challenging,” explained Jim Cormier, director of the Atlantic division Retail Council of Canada.

Police criminals steal credit card information and use them to place large orders online or over the phone.

“[Once] transactions go through, usually the fraudster will set up a third-party transport to pick up the item and deliver it out of province,” said Thompson.

Thompson said there is no way for police to trace the item. Despite the number of recent cases in Nova Scotia, no arrests have been made.

“A lot of the times these have links to organized crime which makes it very difficult to identify these people and arrest them, and it also creates issues because they use fake identities like fake emails, addresses, etc.,” Thompson said.

Ryan O’Leary, CEO of Sonapay, said he reminds merchants to be vigilant in combating the possibility of being scammed.

“I would advise them to ensure that the product technology that they’re using today is aligned to the way they’re going to be processing credit card transactions,” he said.

Thompson said a change in season plays a role in the type of things people to try to purchase with compromised credit cards.