Judging from the latest statistics, the most lucrative work-from-home job in America may be Con Artist. Fraudsters are utilizing texts, social media, fake websites, apps, emails, and old-fashioned voice calls to separate Americans from their money — billions every year. They play on our greed, or charity, or desperation. And they take all forms of payment.
The best way to fight back against fraud is to be aware of current schemes so you don’t fall victim in the first place. Below we share the top eight financial shakedowns, with enough details to help you recognize red flags, and statistics that will blow your mind. Read on to learn how to avoid getting fleeced (and how to report it if you are).
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Identity Theft and Credit Card Fraud Trends
Cases of credit card fraud are skyrocketing: Schemes that target individual consumers rose more than 70% in 2021 over the previous year, according to the Federal Trade Commission (FTC). Almost 3 million consumers collectively lost more than $5.8 billion to fraud in 2021 alone.
What’s behind the increase? During the pandemic, more people took to shopping online, even for things like groceries. At the same time, the pandemic inspired scammers to promise vulnerable folks quick delivery of hard-to-find PPE. And other natural disasters — from fires in California to flooding in Kentucky — spawned fraudsters targeting charitable givers and even disaster victims looking for help with clean-up and repairs.
Scam text messages — no, that’s not the U.S. Post Office — have also spiked in recent years, adding to the flood of fraudulent messages. And finally, the rise of crypto seems to play a role: The FTC has warned consumers that no reputable utility or creditor will demand payment only in crypto.
If you’re a victim of credit card fraud, it’s important to report it ASAP. You can get your credit report and find out your credit score for free at AnnualCreditReport.com
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33 Identity Theft and Credit Card Fraud Stats
Below we do a deep dive into the most common types of fraud: imposters, online shopping scams, fake prizes and sweepstakes, false job opportunities, fictional charities, investment swindles, and more. All numbers quoted below are for the first half of 2022.
Educate yourself about other types of money scams too.
1 Imposters: Reports Filed
The total reports filed in this one category came to 361,735, with 22% of filers admitting losses. An imposter is a person who pretends to be someone else to steal your personal information or money. They might call, text, or email you and may pose as someone you know. (“I’m on vacation in London and lost my wallet! Can you send me some cash?”).
2 Imposters: Losses
The median loss suffered by victims was $1,000. The total dollar amount of imposter scam losses was $1.33 billion.
3 Imposters: Scenarios
The most common way imposters approached targets was via phone call, and victims paid via credit card.
4 Imposters: Top States Affected
Maryland led with 7,282 reports. Oregon and Washington followed close behind.
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5 Online Shopping: Reports Filed
Total reports filed came to 148,464, with 51% claiming losses. In an online shopping scam, someone pretends to have a legitimate business by creating a phony website or posting fake ads on a real retailer’s site.
(Another form of this fraud is when scammers create and post fake negative reviews of small businesses and then tell owners that they’ll remove the reviews in exchange for digital gift cards.)
6 Online Shopping: Losses
The median loss suffered by victims was $186. The total dollar amount of online shopping scam losses totaled $183.8 million.
7 Online Shopping: Scenarios
Victims are most often taken in by websites or apps — not surprising, given the nature of this fraud — and are asked to pay via gift card.
8 Online Shopping: Top States Affected
Delaware led with 516 reports. Colorado and Nevada placed second and third.
9 Prizes & Sweepstakes: Reports Filed
Total reports filed came to 43,214, with 16% reporting losses. “Great news!,” a voice over the phone gushes. “You’ve won money or valuable prizes!” All the winner needs to do is provide their bank account information or pay a processing fee.
10 Prizes & Sweepstakes: Losses
The median loss suffered by victims was $900. Total losses equaled $114.4 million.
11 Prizes & Sweepstakes: Scenarios
Phone calls are the most common contact method. Gift cards were the top payment type.
12 Prizes & Sweepstakes: Top States Affected
West Virginia topped the list with 388 reports. Wyoming and Alaska placed and showed.
13 Internet Services: Reports Filed
Total reports filed equaled 36,386, with 7% admitting losses. This category includes the use of fake messages or copycat sites — ostensibly from someone’s internet service provider — as part of a phishing or spoofing scam used to commit identity theft. It also includes theft of personal information: debit card PINs, credit card and bank account numbers, and passwords.
14 Internet Services: Losses
The median loss suffered was $300. Total losses came to $13.4 million.
15 Internet Services: Scenarios
Typically, individuals are contacted via social media and send money via payment app.
16 Internet Services: Top States Affected
Delaware was first in line with 130 reports. Nevada and Florida came close on its heels.
17 Job Opportunities: Reports Filed
Total reports filed were 44,609, with 31% reporting a loss. Scammers post genuine-looking want ads and business opportunities in print and online. The catch? There is no job. They just want your personal information and your money. As just one example, a “work-from-home career” starts after the target pays for training, certifications, and/or starter kits.
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18 Job Opportunities: Losses
Consumers experienced a median loss of $1,950. Total losses reached $163.9 million.
19 Job Opportunities: Scenarios
People are most often connected by text and pay the scammers via cryptocurrency.
20 Job Opportunities: Top States Affected
Nevada was again the top contender, with 475 reports. Maryland and Florida achieved second and third place.
21 Advance Payments: Reports Filed
Total reports came to 18,746, with 28% of them suffering a financial loss. Advance payments, as the name implies, refer to a consumer pre-paying for a service. Credit service businesses purport to sell information that will allow the consumer to create a new credit file — perhaps after an identity theft occurred.
22 Advance Payments: Losses
The median loss of each victim was $700. The total amount lost was $52.9 million.
23 Advance Payments: Scenarios
Fraudsters typically communicate with potential victims via websites and apps for this kind of scam, and request wire transfers to collect the money.
24 Advance Payments: Top States Affected
Georgia is number one this time, with 1259 reports. Nevada and Delaware follow as numbers two and three.
25 Fake Charities: Reports Files
Total reports came to 4,538, with 23% reporting a monetary loss. Scammers pretend to be from a real or fake charity and ask you to make a donation right then for, say, a natural disaster that just occured.
26 Fake Charities: Losses
The median loss was $450. The total amount lost was $10.1 million. Asking people to support a heartwarming cause has, unfortunately, been quite successful.
27 Fake Charities: Scenarios
Messages go out via social media, and have the potential to go viral. Scammers most often collect their money through a payment app.
28 Fake Charities: Top States Affected
Alaska led the way with 17 reports. Maine and Utah came in second and third place.
29 Investments: Reports Filed
Total reports came to 52,453, with 76% claiming a financial loss. With investment fraud, a scammer tries to get you to invest: in stocks, bonds, real estate, whatever. They may provide false information about a real investment or make something up entirely.
30 Investments: Losses
The median loss was $4,000. Total losses equaled $1.6 billion.
31 Investments: Scenarios
These so-called investment opportunities are described on social media platforms, with cryptocurrency being the top payment method.
32 Investments: Top States Affected
Nevada (again!) leads the way, with 451 reports. Washington and California trail behind in terms of percentage of population, but are way ahead in absolute numbers: Washingtonians filed 1,074 reports; Californians, 5,349 reports.
33 Bonus Stat: Tax Prep
A missing refund is one sign that someone else may have filed a fake tax return in your name. Here’s more information about what to do when you don’t receive a tax refund.
The FTC notes that 4,056 reports about tax preparation fraud were filed in the first half of 2022, with 12% of people reporting a monetary loss. The total loss was $800,000, with a median loss of $188.
How To Avoid Credit Card Fraud
As these numbers show, there are plenty of scammers out there. Here are some ways to protect yourself against money scammers:
• Avoid using debit cards, which are directly connected to your bank account. Credit cards and payment apps tend to be safer. Check your banking and credit card statements regularly, watching for errors and suspicious charges.
• If your bank offers free transaction alerts, sign up now. For example, you can get an alert whenever a large payment (you choose the number) hits your account. Find out more about different types of bank fraud.
• If you get a call from a company asking for payment data or other personal information, hang up. If it’s a company you normally deal with, call them back directly to see if the call was genuine.
• Use password protection on your smartphone and computer devices. Keep your browsers up-to-date, and use reputable anti-virus software downloaded from the app store (not an ad, email or website). Avoid using public WiFi.
• Shop at reputable retailers only, including but not limited to the ones you use online. If you have questions about a store, check them out on the Better Business Bureau website.
• When pumping gas or using an ATM, watch out for skimmers: devices that capture your account information for fraudulent purposes. If anything looks odd, let the establishment know.
• Be cautious about clicking on links from unknown sources, checking to make sure that an email or text message really came from the place it claims and is a reputable organization.
• Monitor your credit report and watch for inaccuracies. What qualifies as credit monitoring varies, so look for services that send alerts whenever something new hits your report.
How to Report Credit Card Fraud
The first step is to file a dispute with your credit card company. Then you can contact your police station or sheriff’s office. You can also report the fraud to your state’s attorney general (get their contact info from https://www.naag.org/find-my-ag/) You can also submit an online claim with the FTC at https://reportfraud.ftc.gov/#/
Scammers are reaching out via text, social media, fake websites, apps, emails, and old-fashioned voice calls to separate you from your money. Their stories play on your greed, or charity, or desperation. And they take all forms of payment — but they especially like gift cards and crypto. By learning to recognize the top schemes, you can help protect yourself from getting swindled. More pro tips: Monitor your transactions, avoid using debit cards for purchases, and don’t ever give out your personal or financial info unless you’re 100% sure of who you’re dealing with.
You can help protect yourself with free credit monitoring from SoFi Relay. The SoFi Relay money tracker app allows you to manage all of your finances from one convenient dashboard. See the big picture while you’re fighting fraud with weekly credit report updates.
What are some common credit card scams?
Scammers can be pretty creative. Phishing is when a con artist tries to get you to share personal info or credit card information on the phone, by email, or text. Fake online websites can be built to steal credit card info. Skimmers can be set up on ATMs and credit card readers. And people with ill intent can monitor public WiFi for credit card info. And these are just some of the types of financial fraud out there.
How do credit card scams happen?
Sometimes, your physical credit card can be stolen. More often, someone gets your credit card data without having the actual card. Identity thieves can also steal personal information, set up credit cards in your name, and start spending.
How can you spot credit card fraud?
As you monitor bank statements, credit card statements, and your credit report, you may spot information that just isn’t right. Although this isn’t always because of credit card fraud, that’s a common cause. Proactively investigate when something looks suspicious. You can also set up alerts with your bank to flag certain kinds of transactions.
Photo credit: iStock/SaskiaAcht
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.