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Episode: Data Points: Cons, Schemes, & Fraud

Author: Broken Cycle Media | Wondery
Duration: 00:11:26

Episode Shownotes

Sources:As Nationwide Fraud Losses Top $10 Billion in 2023, FTC Steps Up Efforts to Protect the Public. (2024, February 9). Federal Trade Commission. https://www.ftc.gov/news-events/news/press-releases/2024/02/nationwide-fraud-losses-top-10-billion-2023-ftc-steps-efforts-protect-publicBBB Tip: 10 steps to avoid scams. (2024, June 21). Better Business Bureau. https://www.bbb.org/article/tips/8767-bbb-tips-10-steps-to-avoid-scamsThe Latest Scams You Need to Be Aware of in 2024, By DeNicola, L.

(2023, December 30). https://www.experian.com/blogs/ask-experian/the-latest-scams-you-need-to-aware-of/​​Empowering Fraud Fighters. (n.d.). Financial Industry Regulatory Authority Foundation. https://www.finrafoundation.org/networks-we-strengthen/fighting-fraudInternet Crime Report 2023 by The Federal Bureau of Investigations. (2024). In Internet Crime Complaint Center. https://www.ic3.gov/Media/PDF/AnnualReport/2023_IC3Report.pdf National Center for Victims of Crime, Financial Crime Resource Center: https://victimsofcrime.org/financial-crime-resource-center/ Financial Crimes Enforcement Network, FinCEN Resource Center: https://www.fincen.gov/fincen-resource-centerFletcher, E. (2023, October 6). Social Media. Federal Trade Commission. https://www.ftc.gov/news-events/data-visualizations/data-spotlight/2023/10/social-media-golden-goose-scammersIdentity Fraud Cost Americans $43 Billion in 2023. (2024, April 10). American Association of Retired People. https://www.aarp.org/money/scams-fraud/info-2024/identity-fraud-report.htmlIs Fraud Always a Federal Crime? (2024, March 20). Stechschulte Nell. https://www.tpatrialattorneys.com/fraud-always-federal-crime/Criminal Consumer Fraud, Must the Goals of Deterrence and Compensation Be Mutually Exclusive? By The American Journal of Criminal Law, Kirschner, N. M. (1979). https://www.ojp.gov/ncjrs/virtual-library/abstracts/criminal-consumer-fraud-must-goals-deterrence-and-compensation-beRecovering From Online Fraud. National Crime Victim Law Institute: https://ncvli.org/recovering-from-financial-fraud-and-identity-theft-services-for-victims/#:~:text=%E2%80%93Identity%20Theft%20Resource%20Center%20What Are Some Common Types of Scams? (2024, March 13). Consumer Financial Protection Bureau. https://www.consumerfinance.gov/ask-cfpb/what-are-some-common-types-of-scams-en-2092/Resources:FBI Internet Complaint Center: https://www.ic3.gov/FBI Tip Center: http://tips.fbi.govBBB Scam Risk Calculator: https://www.bbb.org/all/scam-prevention/risk-calculatorCybercrime Support Network: https://fightcybercrime.org/Identity Theft Resource Center: https://www.idtheftcenter.org/Financial Industry Regulatory Authority: https://www.finra.org/Report Fraud to the Federal Trade Commission: https://reportfraud.ftc.gov/For additional resources and a list of related non-profit organizations, please visit http://www.somethingwaswrong.com/resourcesFollow Something Was Wrong:Website: somethingwaswrong.com IG: instagram.com/somethingwaswrongpodcastTikTok: tiktok.com/@somethingwaswrongpodcast Follow Tiffany Reese:Website: tiffanyreese.me IG: http://www.instagram.com/lookieboo The Data Points cover art is by the Amazing Sara Stewart. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Full Transcript

00:00:00 Speaker_01
Wondery Plus subscribers can listen to Something Was Wrong early and ad-free right now. Join Wondery Plus in the Wondery app or on Apple Podcasts.

00:00:14 Speaker_01
Although cons, schemes, and fraud can make for intriguing storylines, the true impact of fraud has pervasive detrimental effects on its victims that are not often highlighted in society or media.

00:00:29 Speaker_01
Relatedly, the FBI website enlists 18 different common types of fraud and scams on their website.

00:00:37 Speaker_01
including but not limited to identity theft, business and investment fraud, charity and disaster fraud, property scams, mortgage fraud, extortion, sextortion, adoption fraud, cryptocurrency investment fraud, elder fraud, election crimes, healthcare fraud, mail fraud, holiday and romance scams.

00:01:02 Speaker_01
In 2023, the Federal Trade Commission data showed adult consumers reported losing more than $10 billion to fraud, which was the first time that reported fraud-related losses had reached an amount that high.

00:01:17 Speaker_01
This number is a 14% increase over reported losses in 2022.

00:01:23 Speaker_01
Considering these alarming statistics and the increasing use of artificial intelligence to victimize many people at once, the Broken Cycle Media team believes it's essential to highlight the most common cons, schemes, and fraud.

00:01:37 Speaker_01
It's important to note that the FTC highlights that anyone can become a victim of fraud, although victims in different age ranges do largely fall victim to different types of fraud.

00:01:48 Speaker_01
The FTC points out that in 2021, people ages 18 to 59 were 34% more likely than older adults ages 60 and over to report losing money to fraud, with some types of fraud being more common than others.

00:02:04 Speaker_01
Younger adults were more likely to fall prey to online shopping scams, which often started with an ad on social media, far more often than any other fraud type.

00:02:16 Speaker_01
Younger adults also reported losing money on job scams at more than five times the rate of older adults. And with the invention of the internet, the accessibility and ease of committing fraud has increased immensely.

00:02:30 Speaker_01
The Federal Trade Commission reports that of all reported fraud from 21 to 23, victims who made initial contact with scammers through the internet were scammed out of a total of nearly $6 billion.

00:02:46 Speaker_01
One in four people who reported losing money to fraud from 21 to 23 said it started on social media, and those victims reported losses that reached a whopping $2.7 billion, which is significantly higher than victims that were frauded through other contact methods.

00:03:05 Speaker_01
Social media is also being used to increasingly target younger victims, and is the method of communication in 47% of fraud reported by 18 to 19-year-olds.

00:03:17 Speaker_01
Still, most fraud is actually not reported, which means that these numbers are actually just a fraction of the harm that common cons, schemes, and frauds cause in the internet and social media age.

00:03:31 Speaker_01
As Experian highlights, artificial intelligence-powered scams are increasingly important to keep an eye out for. These scams can produce highly convincing emails, phone calls, and texts.

00:03:45 Speaker_01
They can also create quality deepfakes featuring celebrities or otherwise influential people to trick victims into investing into a business or idea.

00:03:56 Speaker_01
AI-powered scams can even trick victims into believing a family member, loved one, or employer is on the other end of the con.

00:04:05 Speaker_01
Artificial intelligence can also offer the perpetrator the ability to fabricate images, videos, sounds, or other content in the likeness of the victim and potentially use it to extort other victims.

00:04:19 Speaker_01
You can report extortion to the police and to your local Federal Bureau of Investigation field office by calling 1-800-CALL-FBI or online at tips.fbi.gov.

00:04:33 Speaker_01
You can also report threats involving the internet, such as when a mobile payment app is involved, to the FBI's Internet Crime Complaint Center at www.ic3.gov.

00:04:47 Speaker_01
Another common scam is the sale of non-existent goods or services, which includes online purchase scams. Scammers will often use mobile payment apps to trick people into sending money or merchandise without holding up their end of the deal.

00:05:03 Speaker_01
For example, a scammer may offer to sell you concert tickets. or lease you a home, but then never actually give or lease them to you.

00:05:11 Speaker_01
A scammer may also purchase an item from you, receive the item, appear to send a payment, and then cancel the payment before it reaches your bank account. These sorts of scams are criminally deemed business fraud.

00:05:26 Speaker_01
If you think you made a payment to a scammer, contact your bank or the company you used to send the money immediately and alert them that there may have been an unauthorized transaction.

00:05:37 Speaker_01
You can also file a complaint with the Federal Bureau of Investigation's Internet Crime Complaint Center at www.ic3.gov.

00:05:48 Speaker_01
Although there are many different types of scams, the Consumer Financial Protection Bureau offers some things to consider in all cases of fraud.

00:05:56 Speaker_01
First, scammers may work to gain your trust, often pretending to be someone you trust or even pretend to be a company or government agency you already know. Scammers will also create a sense of urgency, intimidation, and fear.

00:06:12 Speaker_01
They want you to send the money before you have a chance to confirm or deny their claims or second-guess their choices. Don't let anyone rush you into giving them payment or sensitive business information.

00:06:25 Speaker_01
Scammers will also ask you to pay in specific ways. They often demand payment through alternative methods like wire transfers, cryptocurrency, or gift cards. But they can also use peer-to-peer mobile apps and other money transfer options.

00:06:43 Speaker_01
Although fraud can be charged criminally and civilly, and each state does so differently, the Department of Justice shares federal and state laws are not sufficient to deter consumer fraud effectively.

00:06:56 Speaker_01
Because of this, victims of fraud and consumer scams often report feeling dissatisfied with the way the crimes are addressed. Victims are often compelled to seek both civil and criminal charges in order to receive more encompassing justice.

00:07:12 Speaker_01
However, fraud can be charged federally if and when the fraud committed violates federal law, involves a federal agency, crosses state lines, uses the United States Postal Service, or interstate communication methods in their scheme, or if it involves fraud as a means to benefit from a federal program.

00:07:34 Speaker_01
Despite the variability in fraud schemes and the way that they're addressed, the Better Business Bureau has some general steps that can potentially help all consumers avoid scams.

00:07:45 Speaker_01
One tip is to keep your personal information private and, if stored, making sure to do so in a highly secure way. Relatedly, it's suggested that users establish passwords that are more complex and not easy to guess.

00:07:59 Speaker_01
Also, know that your bank or financial institution will never contact you to ask for passwords or PINs. The Better Business Bureau also suggests working with local businesses as frequently as possible.

00:08:12 Speaker_01
Although local businesses are also capable of fraud, fraud is more likely to occur when distance exists between the patron and business. The Better Business Bureau also highlights the importance of being careful what you share online.

00:08:27 Speaker_01
People who commit fraud often weaponize information about their targets that they can find on social media platforms. When seeking purchases online, you can request to see the property in person before submitting payment.

00:08:42 Speaker_01
When paying people, avoid using cash when you can. Having a digital trail can help. And although scammers can use digital apps as part of their schemes, the apps themselves are not inherently fraudulent.

00:08:56 Speaker_01
Using discretion and the aforementioned tactics when sending money via any method can help prevent falling victim to fraud. Additionally, an interesting educational tool is the Better Business Bureau's Scam Risk Calculator.

00:09:11 Speaker_01
It offers targeted scam prevention education based on basic personal information. The calculator is linked in the episode notes. Another preventative measure is to report suspected scammers.

00:09:25 Speaker_01
If you were scammed or think you saw a scam, report it to the FTC at Report Fraud You can also report fraud to your state's Department of Consumer Affairs by searching online for their respective website.

00:09:42 Speaker_01
If your personal information has been compromised, the IRS Identity Protection Specialized Unit can be contacted to flag your tax files to ensure that your information is not used to falsify tax refunds.

00:09:57 Speaker_01
In the event that your identity has been stolen, the Identity Theft Resource Center is a national nonprofit organization. The ITRC website offers tools that help victims through the recovery process and provides links to resources.

00:10:14 Speaker_01
In addition to the website, you can call ITRC at 1-888-400-5530.

00:10:23 Speaker_01
The Financial Industry Regulatory Authority offers resources on their website for those working to combat financial fraud, and they also offer victim resources and training for first responders.

00:10:35 Speaker_01
Cybercrime Support Network is a non-profit collaboration created to combat cybercrime that is working towards prevention and also offers resources for victims.

00:10:46 Speaker_01
For more information about the nonprofit organizations and websites mentioned, please visit the episode notes.

00:10:54 Speaker_01
For a more comprehensive list of free and confidential organizations that are working to help victims, please visit somethingwaswrong.com slash resources.

00:11:05 Speaker_01
Many of the amazing groups listed on our website are only able to exist because of the community's help and support.

00:11:12 Speaker_01
If you would like to find out more information about volunteer opportunities, please feel free to visit the resource page and reach out directly to the organization of your choice. I'm Tiffany Reese.

00:11:25 Speaker_01
This episode was written in collaboration with our two associate producers, Amy B. Chesler and Lily Rowe. Thank you so much for listening and learning with us.

00:11:38 Speaker_01
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