Wednesday, April 1, 2026
Fraud can leave you with unexpected debt. Learn how common scams happen, what steps to take right away, and how a Licensed Insolvency Trustee can help you recover.
Written by: Ilan Kibel, CPA, CIRP, LIT
The evolution of financial fraud has increased in recent years. The consequences are often more emotional and leave victims buried in debt. Sophisticated online scams, to identity theft, individuals find themselves responsible for liabilities they never intended to take on.
Understanding the most common types of fraud—and knowing where to turn for help—can make a critical difference in recovery.
Fraud is no longer limited to obvious schemes. Today’s scams are highly targeted, psychologically manipulative, and often technologically advanced. Victims unknowingly authorize transactions, provide sensitive information, or take on debt without realising it. In a lot of cases, financial institutions hold individuals responsible, leaving them to deal with the fallout.
Stolen personal information is often used to open credit cards, secure loans, or access existing accounts. Victims of this fraud only discover the issue after receiving collection calls or seeing their credit score plummet.
The impact here is large balances owing and an impact on your credit rating.
Emails, texts, QR Codes, or fake websites trick individuals into providing login credentials. Once accessed, funds are taken out of your accounts or new borrowings are set up in your name but used by the fraudster.
The impact here is that your credit is maxed out, and your information is compromised.
When they say if it sounds too good to be true, it must be a scam. A promise of high returns is often a sign. Most of the time these appear legitimate and even show fake account growth or celebrity endorsement. Victims may borrow funds to “invest” more and are often asked to pay even to recover their own funds.
The impact here is increased debt for fake investments resulting in no returns, but high debt obligations that cannot be repaid.
Some people are lonely and fraudsters take advantage of this. They build online relationships and trust and then request financial assistance. Often convincing victims to borrow money to send to them.
The impact here is incur more debt, for love that may not be real.
Due to increase cost of living, individuals may be desperate for work. In recent years, candidates have been asked to pay upfront fees or purchase equipment for roles or equipment that does not exist.
The impact is taking on credit for an unknown opportunity.
We have all had people come to our front door offering services and or products. Fraudsters will even pose as government agencies, utility companies, or even family members in distress. Fraudsters tend to create urgency to extract money quickly.
The impact here is high-interest borrowing resulting in debt you cannot repay.
Victims of these types of fraud often feel shame or responsibility, even though they were manipulated. Financial institutions may not always reimburse losses, especially if transactions were authorized—even under false pretences.
As a result, individuals can be left dealing with:
If you find yourself a victim of one or more of these scams, then the first thing you should do is report it to the financial institution and the Police.
If your financial institution is unable to resolve this, and says you are responsible for the debts, then reaching out to a Licensed Insolvency Trustee (LIT) may be your best option.
LITs are licensed by the Office of the Superintendent of Bankruptcy to assist individuals struggling with debt, whether you incurred the debt knowingly or are a victim of fraud. LITs help individuals regain control when fraud leads to overwhelming debt.
An LIT reviews your full financial situation in order to determine the best course of action.
Depending on the circumstances, options may include:
Once you engage an LIT, we communicate directly with creditors, stopping collection calls and legal actions. This provides immediate relief and breathing room.
Beyond resolving debt, an LIT can help you:
If you suspect fraud has contributed to your financial situation:
The sooner you act, the more options you’ll have.
Fraud can happen to anyone—and it’s becoming increasingly common. The key is not to let the resulting debt define your future. With the right support and professional guidance, it’s possible to recover financially and move forward with confidence.
If you’re dealing with debt tied to fraud, don’t try to navigate it alone. The system exists to give you a second chance—you just need to take the first step
Wednesday, April 1, 2026
Fraud can leave you with unexpected debt. Learn how common scams happen, what steps to take right away, and how a Licensed Insolvency Trustee can help you recover.
