Showing photo ID is a fairly common practice in Canada, but be very careful if you’re asked to provide a Social Insurance Number.
March is Fraud Prevention Month, so this is a good opportunity to discuss identity theft. A key advantage of working with a registered real estate salesperson, or broker, is that this person is required by law to ensure the parties in a transaction actually are who they say they are, and that nothing potentially illegal is occurring. Part of this stems from anti-money laundering regulations that were introduced in 2001, and overseen by the Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC.
That’s why a salesperson will ask the client to show a piece of government-issued photo ID, such as a driver’s licence or a passport, and then confer with the other party’s representative. When the buyer and seller are ready to make a deal, each knows the other is legitimate, but neither has the other’s personal data.
Showing photo ID is a fairly common practice in Canada. But be very careful if you’re asked to provide a Social Insurance Number (SIN) — a SIN is a valuable piece of information for identity-theft scammers. If you determine being asked for your SIN is unreasonable, then either offer another form of identification, ask to speak to the individual’s manager or walk away.
The only time a real-estate salesperson might ask for your SIN is when a deposit has earned an amount of interest in a brokerage trust account that makes it reportable to the Canada Revenue Agency. With few exceptions, though, your SIN really should be shared only with your employer, and with government departments and agencies when you pay your taxes or apply for benefits.
One of the scariest kinds of identity theft in real estate is title fraud. A criminal will use phoney documents to transfer ownership of a property to his or her name, and then either attempt to sell the place or apply for a mortgage. After the money has been secured, the criminal will vanish and the homeowner is left without a home or with a huge mortgage on the property. Mortgage fraud can be very difficult to remedy.
You would also be well-advised to:
- Regularly review your credit card, bank and other financial statements
- Verify the information in your credit report each year. Your credit report can be obtained through Equifax Canada or TransUnion Canada
- Pay attention to your billing cycles, and contact a customer-service rep if your bills don’t arrive on time;
- Never give out personal or financial information over the phone, via email or online unless you initiated the conversation, or know who contacted you; and
- Shred or destroy all financial documents before you throw them out.
If you suspect that you are a victim of identity theft, it’s important that you file a report with your local police and contact: your financial institution and credit card company; both national credit bureaus (Equifax Canada and TransUnion Canada); and the Canadian Anti-Fraud Centre.
In addition, if an identity theft crime involves the buying or selling of a property, tell the Real Estate Council of Ontario.
Article written by Joe Richer , Registrar of the Real Estate Council of Ontario (RECO).
He oversees and enforces all rules governing real estate professionals in Ontario. Email questions to firstname.lastname@example.org. Find more tips at reco.on.ca, follow on Twitter @RECOhelps or on YouTube at youtube.com/RECOhelps.