Victims share stories: "If it can happen to me, it can happen to you"
Shannon Baxter (early 20s) was attending business classes at NAIT part-time and working at the family business, Yellowhead Storage, full-time during the week.
She started helping out her mother, Heidi, with invoices and sales. One day, she came across an invoice from a company that she did not recognize. She phoned the company asking for verification because she thought it was a scam. Her instinct was right - it was a phishing scam.
In 2014, Shannon found another invoice for the purchase of shipping containers that didn't seem right. She shared it with the accountant and then tried to track down the buyer, only to discover that the phone number was out of service.
Shannon informed her parents that the buyer didn't exist. Heidi admitted taking and selling the shipping containers to her husband, Joe. She had established a shell company called West Yellowhead Transport and had been selling the containers between April 2013 and February 2014. A company driver, Travis, was assisting her.
"You always think of family as people you can trust. But people can change," said Shannon. "One memory I have of my mother is at a grocery store. She found 20 dollars on the ground and handed it to the cashier because it didn't belong to her."
Heidi was let go from the company and a new general manager was hired. Shannon soon discovered that the new manager was making unauthorized credit card purchases with the corporate card and accumulating late charges on invoices. His employment was also terminated.
In October 2016, Shannon became the new general manager of the company. Since then, she has implemented basic business processes/procedures, checks and balances, security cameras, digital systems and file back-up processes to ensure the safety of all employees and the business. There is also a new system in place that ensures the shipping containers in the yard are physically counted once a month.
"My grandma, she started the family business. She was semi-retired and still came in once a week to check on things. She had rules. Like, don't let the phone ring more than twice or that everyone should know at least two people's roles," said Shannon. "When I took over, I re-implemented some of her practices. She was a watcher. Now, I'm one."
On January 8, 2018, Heidi was convicted and sentenced to 15 months in jail. She admitted to profiting just over $153,000. The family company, Stankay Holdings, lost an estimated $360,000 throughout Heidi's scam.
This type of scam is an example of a financial crime. Typically referred to as white collar crimes, these scams are nonviolent crimes committed in commercial situations by individuals, groups or corporations for financial gain.
In 2017, EPS Economic Crimes Section reviewed 44 financial fraud files. It is currently known that $176,163,288.00 has been lost. However, once these files have all been concluded, it is anticipated that the actual losses could be double that value, in excess of $352 million.
"Through the process of fraud investigations, we typically find that the total amounts of money lost increase substantially," said Det. Linda Herczeg with Economic Crimes. "We have files that have shown that the initial losses reported were in the tens of thousands of dollars and end up resulting in millions of dollars lost as additional victims are found throughout the course of the investigation."
Fraudsters rely on their ability to convince victims that the loss of money was out of their hands and control. They use creative stories and sometimes intimidation, to prevent or discourage victims.
The more people that share their story, the more we can reduce the embarrassment and stigma associated with victims of fraud. Be part of the conversation on fraud prevention by joining our interactive Facebook Q&A session with Det. Herczeg on Thursday, March 29, 2018 at 1 p.m.
For additional fraud and crime prevention tips, please visit www.edmontonpolice.ca/Fraud.
The EPS reminds citizens that fraud prevention is ongoing - we need to recognize it, report it and stop it.
If you are a victim of fraud, or have knowledge of an economic crime, please contact the EPS at 780-423-4567 or #377 from a mobile phone. Anonymous information can be submitted to Crime Stoppers at 1-800-222-8477 or at www.tipsubmit.com/start.htm.
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