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ASC ExternalSite > Investors > Investor Resources > You ASC'd Blog > Posts > Avoid financial disasters in times of natural disaster

July 05
Avoid financial disasters in times of natural disaster

Many are now aware of or have been affected by the recent flooding in southern Alberta. We have also witnessed the generosity and resilience of Albertans during this time. While this spirit of perseverance and giving to others is heart-warming, and essential to those trying to rebuild their lives, unfortunately these types of disasters also attract those looking to profit from the situation.

If you, friends or family members are in crisis, keep the following in mind:

  • During a crisis, people are especially vulnerable to, and more likely to make, rushed or poor decisions. When it comes to finances, that can lead to a higher risk of fraud. This vulnerability can be caused by lost income from a temporarily or permanently closed business, personal property damage, trauma from disaster, or simply physical, mental and/or emotional fatigue in our families and those around us.
  • One of the first things you may need to do is to try to gather all the information about your finances, assets and investments into one place. If you’ve lost documentation on account numbers and passwords that may have been written in hard copy or stored on a computer that has been damaged, find someone that you know can be trusted that can help you gather this information (e.g. you can contact your financial institutions or investment adviser for some of this information).
  • You may find yourself needing to recoup from a large financial loss (such as losing part or all of a home or business). Don’t rush into any emotional decisions about your or your family’s financial future. While you may feel the pressure to act quickly, take the time to properly look into new opportunities to avoid getting involved in another potentially devastating financial situation.
  • If you need to make a big decision right away, consider whether there is someone you know who is trustworthy that can help you weigh pros and cons if you need advice, or if you are unable to make decisions for yourself.

Some tips for those wanting to donate or help others:

  • Wanting to donate time, materials or money to help others? Great! To avoid being taken advantage of, try to first do some quick research on the individuals, charities or businesses that may solicit you for financial or material contributions.
  • Many organizations and businesses will promise to donate to disaster relief if you purchase a product or service from them. Depending on the business, this may or may not be true. Even if it is, don’t let the promise of a charitable donation influence you into decisions that aren’t suitable for your needs.
  • While it is common to be approached with a disaster relief scam via the phone, you should also be wary of online requests for help. These can come via fake websites, spam emails, or social media. These are quick and easy channels for someone to anonymously collect personal and financial information from you that can be misused.
  • If you are asked to make investments into rebuilding infrastructure or housing, do a background check to see if the requests are coming from a legitimate source. If it sounds like an investment or a security, contact our inquiries office to see if the individual or company is required to be registered with us: toll free 1-877-355-4488 or inquiries@asc.ca.
  • If you are being promised a tax receipt for your donation, or if you are volunteering for an organization that is promising tax receipts, you’ll want to be clear on what donations are actually eligible. Contact Canada Revenue Agency for more information on charitable giving. Do an online search and look through news stories, social media sites or online forums that may have information about an individual or supposed charitable organization. These sources can often tell you about unhappy victims, court cases and even rumours that you may want to further investigate.

Even more so in difficult times, it’s important to keep your wits about you. Let’s take care of each other and ourselves in order to rebuild and avoid further financial loss.

 

Blogger

Hi, I’m Lorinda Brinton, Senior Advisor for Investor Education at the ASC. During the last eight years I’ve been working to get you the information you need when making your investing decisions. We have many resources throughout the site to help you be more informed and better protect your money. Check them out – I’m sure you’ll discover some tools or information that will be useful.

Here are some links I think you’ll find helpful: