Fraud Report August 17, 2023

Indiana: Man from India gets nearly four years prison; collected victim money sent by FedX in response to calls claiming the victims Social Security Number had been used in a drug crime; took in $1.5 million

India busts call center targeting Americans, arrest 115 people. Callers claimed to be US Customs, and said packages addressed to them contained illegal substances; had victims buy gift cards, supposedly to cancel the shipment

Poland, with help from Euorpol and the FBI, shut down operation that provided scammers with bulletproof hosting that let them do cyber attacks; arrest five

Singapore police arrest ten who pushed apps on social media that  allowed scammers to get access to bank accounts and steal money

Fake Check fraud up dramatically; crooks rob letter carriers, steal mail from boxes; thefts up 78% over the last year; FINcen says complaints to banks have nearly doubled over two years

Florida: Man gets 8 years prison for interstate moving fraud; used brokers, and raised price after loading goods; just repay nearly $3 million; codefendant also goes to prison

Arizona:  Nigerian man extradited from the UK gets 87 months prison; two other Nigerians extradited from Spain plead guilty to scheme that mailed letters to elderly in the US claiming they were due an inheritance but first had to send money for various fees

Full Report here

Fraud Report August 10, 2023

Fraud Report August 3, 2023

Top Stories

An extended look at the Maria DuVal psychic scam, which took in at one point $23 million every year from direct mailings and small money returns

Spain arrests 101 over text message scams that pretended to be the victim’s bank telling them of security problem and then crooks transferred money from victim accounts into mule accounts going to Malta

Full report here

Fraud Report July 27, 2023

Federal Reserve launches instant payment system FedNow

Scammers will surely exploit it. Consumer fraud issues were posed by NCLC.

Identity Theft Resource Center report; more data breaches in the first half of this year than all of last year

Video by rapper Punchmade Dev explains how to commit bank fraud by hacking; now removed from Youtube

Want to see Taylor Swift? BBB warns that it got 21,000 complaints about ticket fraud last year, a big increase.   Be VERY careful about where you buy tickets

Full report here

Fraud Report July 20,2023

Top Stories

FTC announces major collective effort against telemarketing scams

  • Over 100 state and federal enforcement actions; including criminal cases; includes five new FTC cases
  • One against Fluent filed by DOJ involves tricking people into consenting to receive calls, including robocalls; settles for $2.5 million
  • Another FTC complaint alleges California company tricked job seekers into “agreeing” to get robocalls
  • Third FTC settlement with Florida company that made illegal robocalls; 1.4 billion calls made
  • Fourth with Arizona AG settlement over robocalls trying to sell solar panels
  • Fifth FTC complaint against Florida company that helped overseas robocallers pretending to be Amazon
  • Here is a list of all cases in this effort

India: Police bust call center targeting Canadians asking them to pay for nonexistent online purchases; 23 arrested

Europol issues threat assessment finding that Cybercrime is big business; report itself here

Podcast by Int’l Ass’n of Financial Investigators on pet scams featuring Steve Baker

Does consumer consumer education about fraud work, and do we know if it is effective? By Anthony Pratkanis

Along with law enforcement and policy interventions, consumer education is one of the primary ways to prevent fraud crimes.  Fraud fighters create a steady stream of warnings, fliers, handouts, videos, mailers, web pages, and seminars.  If we are honest, we really don’t know if these interventions are working. More research in this area would be really helpful.

Considerable research finds that information campaigns are generally ineffective.  As Elliot Aronson and I describe in Age of Propaganda, information campaigns fail because it is difficult to break through a message-dense environment and recipients often find information uninteresting and telling them something they may not want to hear.  Education about fraud faces additional obstacles:  the target may have an illusion of invulnerability, be in a rationalize trap, is experiencing warning fatigue, and may perceive the prevention measures as too difficult to implement.  In addition, the con criminal is morphing and changing the scam, and, most importantly, con grifters’ mimicry is purposefully difficult to detect.

For the researcher, the challenge is developing research paradigms that provide efficient, timely evaluations of fraud prevention messages to accumulate knowledge of what works.  This requires being able to “trap the dependent variable” of victimization, which can be difficult to measure in the wild especially using self-reports. I developed the sting methodology (discussed in response to Myth #8) to address this issue.  Other potentially fruitful approaches include the development of proxy, intervening, and mediational measures.

Another valuable source for consumer education is the science of social influence (which I used to develop an investment seminar that reduced victimization by 50%) and fields such as social marketing, public health, drug and tobacco prevention, risk warnings, and public communication.  The knowledge base of these fields can provide guidance on creating and testing effective social influence campaigns to prevent fraud.  

 Editors Note:  My best judgment is that generalized advice such as “if it sounds too good to be true, it probably is” is worthless, and providing education with no context on how common a scam is little better.  A piece that provides a few details on how a scam works, somewhat like the detail to explain a magic trick, is far more effective.  But we could all benefit from more research on what works – and what does not.

Full report here

Fraud Report 7/6/23

Fraud Report June 22, 2023

New York: Jury convicts Canadian man behind tens of millions of mailings claiming to be from psychic, including Mara Duvall; collected $175 million from elderly victims; defendant was extradited from Spain

FCC fines robocall operation $5 million over political robocalls; first time this has been done; political calls have generally been exempt

New AARP study concludes that those over 60 lose $28.3 billion to fraud every year

  • Estimate $8.1 billion lost to strangers; $20.3 billion to caregivers; family members
  • But assume that 2/3 of fraud victims report to enforcers, which is unlikely to be the case

India: FBI, Dehli police, and Interpol bust room in India calling impersonating the IRS and Drug Enforcement Agency (DEA); claim victim responsible for child porn, and requiring victims pay a fine; 6 arrested, including Canadian; group took in $20 million from the US; group also had rooms in Uganda

Want to see Taylor Swift? BBB warns that it got 21,000 complaints about ticket fraud last year, a big increase.   Be VERY careful about where you buy tickets

Full Report here

Fraud Report June 15, 2023

FTC releases spotlight on the top ten text message scams

  • Fake bank security texts top the list
  • Fraud complaints doubled in 2022

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

FBI IC3 gives updated report on Business Email Compromise (BEC) fraud

  • For December 2021 and December 2022 losses increased 17%
  • 277,918 incidents reported
  • Losses of $50,871,501
  • 27% increase in reports of  BEC involving real estate; losses up 72%
  • Also seeing increase where funds sent directly to a crypto exchange

Listen to Steve on the OneRep podcast talking fraud

Diplomat charges that North Korea gets 50% of foreign currency from cyber attacks

FTC information about the new Inform Act; online sellers need to provide contact information about online sellers, and ways to report suspicious activity like counterfeit goods

Interpol warns of worldwide increase in scam call centers kidnapping workers after luring them in with fake jobs

Full report here