Addressing consumer fraud around the world. The Baker Fraud Report focuses on mass marketing fraud – where victims never meet the fraudster in person but communicate over the phone, though the mail, or on the internet.
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BBB updates my study dealing with online shopping fraud
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FTC says robocalls complaints down over 50% since 2021
Useful research on consumer education needed! Many of us spend much time and resources developing consumer education materials, and it would be great to find things that make those more effective. Professor Anthony Pratkanis has compiled and conducted research showing that consumers simply don’t pay attention to most warnings or, worse, become defensive and shut them down. The FTC has tried to combat this with their “pass it on” campaign, directed to tell people they are educating them not to make them afraid but instead to educate themselves so they can help their friends, families, and neighbors avoid frauds. Anthony’s idea is to empower people to become fraud fighters. But he says there hasn’t been research to examine this approach and show it is more effective. Anyone interested in taking this on?
Online shopping. We are rapidly approaching the holiday shopping season, and online shopping is close to the top of the list of scams consumers file complaints about. So be careful, and this is a place where consumer education can do a great deal of good. So stay on the information superhighway, avoid dodgy sites on social media, and file complaints if ripped off.
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Who makes fake websites? Jack Whittaker has long been involved in helping victims of pet frauds, which advertise and sell pets that don’t exist. These are run from Cameroon, and no surprise the same scammers advertise lot of other goods that they never deliver. Jack interviewed many people in Cameroon who make the fake web pages these frauds use, and it is fascinating. His thesis, here, also explains why it is not easy to take down these web sites, since they use hosting and domain name services that are at least complicit.
Where are we with scammers using Western Union & Moneygram to get money? Both companies have been sued the FTC over allowing their services to be used by scammers to get money from victims, often with agents who were either scammers themselves or were complicit. It appears that these enforcement efforts have been largely successful. I’ve not seen a report on losses through either company for several months. Now the frauds often send people in person to pick up the money or have them use Bitcoin ATM’s.
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There are no “safe” accounts. No one is asking for your money to protect it. Over the last several years more and more consumers have been told that their accounts are at risk. This seems to have begun with scammers calling and claiming to be with Social Security, and then transferring them to a supposed federal agent who told them that they were going to be arrested and their accounts would be frozen unless they transferred their money to the government to “protect it” temporarily before it was returned. This is described in some detail in my study of government imposter frauds. There are, now, many variations of this scam. Sometimes they claim to be with a bank and say there is ID theft. And there are other variations. But the common thread is that you need to give your money to someone trustworthy to protect it. No one legitimate will ever do this. I believe that this scam stems from India.
Digital arrest scams sweep India
India arrests 8 for “digital arrest” scams
New study shows Chat GPT can be used to do voice-based frauds; (The ChatGPT article is by computer scientists testing if the latest edition can be used to execute fraud; it is supposed to have safeguards to prevent its use in crime. The researchers simulated being a victim while the LLM did the fraud — mostly on the back end of moving money around. The key finding is that ChatGPT wasn’t useful for bank transfers and impersonating IRS agents. However, credential theft from Gmail succeeded) 60% of the time, while crypto transfers and credential theft from Instagram only worked 40% of the time. This sort of test is important to see if OpenAI and their products are living up to the hype).
Win money for consumer education! NACHA, the association that governs the electronic payment processing industry, announces a contest for short consumer education videos with theme of “Stand Against Scams”
Can the FTC’s new Click to cancel rule survive legal challenges? The FTC’s new rule making it easier to cancel online subscriptions is very popular, and many applaud it. But there have already been many legal actions filed against the Rule. This rulemaking began in the Trump administration. Congress many years ago imposed significant procedural steps that the FTC had comply with before adopting an industry-wide rule. The FTC seems to have violated those in an effort to get the rule adopted before election day. The potential problems are highlighted in the dissent by Commissioner Holyoak. There are ideas here that bipartisan and could really help consumers. But in its haste the FTC may have left itself vulnerable to challenges.
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FTC releases annual report to Congress on scams and older victims
Major data breach of telecom companies by Chinese actors
Internet Wayback machine hacked; 31 million passwords lost
FTC finalizes new Rule that makes it easier to cancel subscriptions and members; 3-2 vote
Hong Kong: Police arrest 27 for crypto romance fraud, seize training materials; losses of $360 million
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New UN report on the International Organized Crime and Scam Centers in Southeast Asia
Rapidly developing use of AI and deepfakes
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Twelve countries take action against Lockbit ransomware gang
India busts four rooms at 32 locations doing tech support calls; arrest 26
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Countries sharing data to fight online fraud. That’s good thing. It would be great to share consumer complaints between countries to target fraudsters, and much data/evidence is held in the US an d other countries. A new UN Convention seems aimed at such problem, but commentators warn about some serious risks for free expression and other rights.
