A new study has found that Americans lost an astounding $4.2 billion to online scams in 2020. The Big Apple, New York was hit particularly hard, losing $415,812,917 to scammers. Ouch!
Business owners, isolated singles and desperate people (i.e. the elderly) who were duped into fake investments lost the most amount of money as fraudsters continue to grow more sophisticated by the day, especially with a lot of us stuck at home due to continued COVID lockdowns.
Amongst the key findings, the exact amount of money stolen in America surpassed the reported $4.2 billion, after a poll of 722 scam victims found that 73% were too embarrassed to file a report!
The five most ‘scammed states’ are California, New York, Texas, Florida, and Ohio. Perhaps most surprisingly, Gen Z has seen a 52% surge in victims since 2017, the most of any age group!
GCT’S Lifestyle Journalist Despina Karp has rounded up the Five Costliest Scams that are out there right now. Beware, they’re very crafty and creative!
Business Email Compromise (BEC): $1.8 billion lost in 2020, with a mind-blowing $96,373 loss per victim. Business owners must be on alert for scammers infiltrating company email systems. They create a fake email that appears as if it is coming from your actual vendor. How this scam works is they send an invoice or email and ask to have the payment sent to a new bank account. How to avoid this scam: Double-check the email address as it is usually off by one letter or number. Beware of glaring typos or odd requests like needing your employee’s social security numbers or birth date.
The good old romance scam! Romance and Confidence Fraud has cost lonely Americans $600 million, with a staggering $25,272 loss per victim. Romance scammers steal photos of good-looking people and target lonely singles online. Once the victim falls in love, they start asking for money or gift cards that cannot be traced. Confidence fraud operates the same way by earning the victim’s trust and then asking for money. How to avoid this scam: Never give money to anyone you meet online. If they will not video chat or meet, they are a scammer. Remember, if it seems too good to be true, IT ALWAYS IS!
Investment Scams: $336 million lost, costing $38,287 per victim. Cybercriminals will offer ‘once-in-a-lifetime investment opportunities’ via email and social media that promise high rates of return at little to no risk. Once you ‘invest’ you’ll never see your money again! It’s that simple! How to avoid this scam: Avoid high-pressure sales tactics and investments that seem too good to be true. Research the person and company and consult a third-party financial expert before parting with any hard-earned cash.
Online Shopping Scams: $265 million lost, costing $2,434 per victim. Probably one you wouldn’t see coming, but fake websites are created that imitate online stores that sells items at a huge discount. If you buy, they pocket the money and never send the item. Moreover, they will steal credit cards and personal information for future online theft and identity theft. How to avoid this scam: Make sure the website is not full of typos. If the “customer service” email is “gmail.com” or “yahoo.com” that is a definite red flag. Research the company and read reviews online.
Possibly the scariest scam: Identity Theft: $219 million lost, costing $5,065 per victim. Scammers steal personal information and use it to access bank accounts, credit cards and even unemployment benefits. They send phishing emails with links, and once you click the link, malware infects your computer or phone and steals your information. How to avoid this scam: Never post personal information on social media, even your birthday. Use a password manager to create many different passwords so if one is compromised, your other accounts will be safe.
So, now that I’ve identified some of the scams you need to be aware of, make sure to put some time aside to download a password manager and install some sort of security program on your computer.
And remember, if it seems too good to be true, it always is!!