Did you know American Romance and Crypto Scams On The Rise as FTC Reports 25% YoY Rise in Fraud Losses

 

The FTC has shared in a new report an alarming statistic linked to romance and crypto scams. As per the findings, there was a 25% YoY rise in fraud losses last year.

The funds lost in such scams hit the $12.5B mark, the agency confirmed. That is nearly $2.5B more from the previous year. Moreover, one out of three people that reported this fraud shared how they lost money.

The figure for fraud reporting stood at 2.6M and there was no rise from the previous year. However, scammers got more sophisticated and could successfully steal people’s money with ease.

The number of people that reported losing such high amounts of funds to scams rose by double digits. In 2023 alone, 27% of all individuals reporting the fraud mentioned they lost funds while the figure rose to 38% last year.

Losses hitting high figures stood at $5.7B and a lot of them arose through investment frauds. These end up deceiving people by making it appear that they were purchasing fake crypto or high-valued metals. Instead, it’s the exact opposite. Crooks spend months building trust with victims before ultimately defrauding them.

Many of the techniques use pig butchering as people get to know one another through dating apps or social media platforms. This is right before they’re asked if they’re keen on making investments in the fraud schemes. A huge share of the people reporting these investment scams say they lost up to $9000 on average.

Another successful scheme’s name is imposter scams. That involves impersonation of companies and government firms that are ranked at the top of the list. These scams are the most frequently reported, reflecting their widespread occurrence.

Email was the most common means that clients report getting contacted by a scammer. Other than that, phone calls were another popular means for targeting individuals, followed up by messages.

Those losing out funds to these schemes reported how the scams first begin online. It could be via websites, social media apps, or even online ads. People lose more than $3B to such scams beginning online. This is certainly much greater than the $1.9B we see being lost through more common means of contact like email, phone calls, and text messages.

Such losses get calculated using material from the FTC’s Consumer Sentinel Network. It takes reports from other agencies. And while no specific reason was outlined for the rise in fraud, it’s clear that scammers are using more sophisticated techniques that keep changing with time.