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Two Nigerian men extradited to the US from the UK plead guilty to inheritance fraud scheme; sent letters to older victims in the US that claimed to be from a bank in Spain; got at least $6 million from over 400

20 percent of all applications to California community colleges are fakes; scammers use ID theft to get financial aid; get federal Pell grants which no longer verify income; Dept of Education says it has 48 investigations of scam gangs doing this  

FBI warns scammers are taking photos and videos, using technology to make them sexually explicit, and then demanding money unless victims send either money or more explicit videos

Spain and Greece lead European effort against counterfeit clothes, shoes, and accessories

  • 378 people arrested
  • Nearly 2 million items seized
  • 278 brands infringed
  • €87 million seized

SEC sues Binance and its founder for selling unregistered securities, other violations; separately moves for injunction and to freeze company assets

Eight who tried to quit their job in Mexican call center offering to “buy” timeshares are murdered; run by cartels;  body parts found buried in plastic bags

FCC taking additional steps to require phone companies to identify and  cut off illegal robocalls

Myth #8:  Consumer education can do little to prevent fraud. By Anthony Pratkanis

At the beginning of this century, I devised a methodology for testing the effectiveness of fraud prevention interventions.  In this “sting” approach, the potential target of a fraud is randomly assigned to either an intervention or a control and then, a few days later, receives a fraudulent pitch.  

Doug Shadel and I used this sting methodology to test various interventions (the results published by AARP).  We found the following:  Reverse boiler room call centers (which warn victims) are an effective intervention tool.  A forewarning message (your phone number is on a list used by fraudulent telemarketers plus information about how to respond to fraud) reduced investment fraud victimization by 50%.  A forewarning message with the addition of questions to ask and think about, in this case asking for a charity’s registration number and how much goes to charity, reduced charity fraud victimization by over two-thirds.  In contrast, a message that increased fear and defensiveness (imagine the con as a stranger with a ski mask coming to your door; would you let them in?) actually increased victimization.  

In addition, Shadel and I developed an investment seminar which taught about the nature of investment fraud, at-risk behaviors, how con criminals persuade, and best practices for preventing victimization.  This was also shown to reduce victimization by 50%.

This research provides a guide to developing effective interventions:  (a) do not raise fear and defensiveness, (b) warn about the crime, (c) provide information about fraud schemes and tools to respond to fraud, and (d) encourage a critical and questioning approach to potential fraud pitches.  Please let the Fraud Report know if you are aware of any additional research on the value of consumer education.

All myths collected here

Full Report here