Financial fraud is on the rise across Canada and agriculture producers are increasingly at risk. Limited knowledge of cybersecurity as well as less secure internet connections often found on rural networks contribute to farmers and ranchers’ vulnerability. 

Safeguard your operation from scammers by keeping up to date with the latest agriculture-specific fraud trends and how to avoid them.

Producers targeted

The cost of fraud in Canada has soared since the pandemic, rising to $577 million in 2023, from $165 million in 2020. While any business can fall victim to a scam, agriculture producers face specific threats.

The key difference is the targeted nature of the scams, says Aisha Kitchlew, Senior Manager Fraud and Cybercrime.

“For example, office workers are more likely to fall victim to scams such as payroll fraud, phishing, or expense scams,” she says. “For someone like a rancher or farmer, the scams are most likely related to industry-specific vulnerabilities.”

Agriculture producers also are more susceptible to phishing attacks impersonating government agencies due to a lack of cyber awareness in the industry, Aisha notes.

Agriculture-specific scams

• Equipment scams: Selling non-existent or faulty machinery online or through ads (at discounted prices).
• Loan and grant fraud: In this type of scam, fraud actors would offer fake agriculture loans or government grants.
• Commodity scams: Scams in which fraud actors pose as brokers and other service providers  and offer discounted prices for crops, livestock, feed, etc.

Ranchers and farmers are particularly vulnerable to business email compromise, a spear phishing technique, Aisha adds. This scam often shows up as vendor compromise, the supplier sends a request to the farmer or rancher to update the account numbers for a future payment/invoice. The farmer or rancher will update the account number and make the next payment to the new account number (which belongs to the fraud actor).

Or, after hacking into a vendor’s customer data, the scammer will pose as a competitor and send emails with discounted prices for crops, livestock, feed, etc.  They then pocket the payment but never deliver the product.

Cheque fraud is another common risk as farmers and ranchers rely heavily on paying with cheques rather than online payments. This leaves them open to fraud as cheques can and are stolen from vehicles and offices or lost in an office or through mail theft.

Online threats on the rise

“Ransomware is one cyber threat that we see less frequently, but I do feel like it will become something more prevalent in this industry,” Aisha warns. “Due to the lack of security in remote networks, the risk of fraud actors hacking a farm system is higher. The fraud actor would then demand payment, disrupt operations such as irrigation or inventory management until the payment has been made.”

Other cyber technology risks include:

• Phishing and spoofing tools: Fake emails and websites imitating trusted suppliers or government agencies.
• Spoofed login pages: Cloned banking login websites that are malicious and gather your credentials.
• Fake equipment sales platforms: Fraudulent online marketplaces offering discounts on machinery and other commodities.
• AI: Using realistic chatbots or voice generated scams to impersonate buyers or lenders. 

Steps to protect your operation

• Verify vendors and deals/purchases: Research equipment sellers, lenders, or buyers before engaging. Verify they are a genuine vendor by calling a phone number from a trusted website, not one in an email.
• Ensure any loans they are trying to obtain are from a legitimate company, again by visiting trusted websites.
• Have baseline cybersecurity controls in place: Implement basic practices such as strong passwords, regularly updated software, and antivirus protection. ATB’s Cybersecurity Toolkit includes a wealth of information to help secure your operation. You can also access the Canadian Centre for Cyber Security’s Baseline Cyber Security Controls.
  Payment methods: Choose electronic payments when possible. Make sure to verify the requesting party before sending funds or updating any account numbers for future payments. 
  Educate: Train everyone in your operation to recognize phishing emails or suspicious offers. Use the KnowBe4 training program. A great resource is the ATB webinar: Fraud prevention and cybersecurity for businesses led by Aisha.

What to do if you are scammed

• Stop communication with the scammer immediately.
• Save all emails, communication, messages, invoices, or anything related to the scam.
• Report to your bank.
• Report to local law enforcement.
• Change your passwords and secure systems to prevent further breaches
• Consider hiring a third-party IT company to ensure your networks and devices are safe from cyberattacks. 

In some instances, you may need to re-open your accounts, Aisha notes. “For example, if a fraud actor gets ahold of your cheque, they can create counterfeit cheques, sell your account number on the dark web, etc. Your financial institution will advise you of the next steps,” she says. If you are an ATB client and would like to report a phishing attack, we encourage you to email fraud@atb.com.

Scammers are getting more sophisticated every day, making it crucial to keep up with fraud trends. Being vigilant, implementing best practices, and educating yourself and others will go far in protecting your operation.