People Are Losing More Money to Scammers Than Ever Before

NEW YORK (NEWSnet/AP) — With the help of technology, scammers are tricking Americans out of more money than ever before. But there are steps you can take to keep your money and information safe.
During 2022, reported consumer losses to fraud totaled $8.8 billion — a 30 percent jump from 2021, according to the most recent data from the Federal Trade Commission. The biggest losses were to investment scams, including cryptocurrency schemes, which cost people more than $3.8 billion, double the amount in 2021.
Younger adults ages 20-29 reported losing money more often than older adults ages 70-79, the FTC found. But when older adults did lose money, they lost more because of assets like savings, pensions, life insurance policies or property.
Scammers now reach targets by social media and text, as well as phone and email.
“The first thing they'll do is get you into a heightened emotional state, because we can’t access clear thinking when we’re in that state," said Kathy Stokes, director of fraud prevention for the AARP’s Fraud Watch Network.
Once the sense of urgency is established, the target's defenses are down.
“When approached with urgency, give it an extra three-second pause,” said Amanda Clayman, a financial therapist who works with digital payment network Zelle around issues of fraud. “When someone is trying to get us to take action quickly, that’s usually a red flag indicating we should do the opposite."
Experts Say 'Hang Up'
Simply being aware of typical scams can help, experts say. Robocalls in particular frequently target vulnerable individuals like seniors, people with disabilities, and people with debt.
“If you get a robocall out of the blue paying a recorded message trying to get you to buy something, just hang up,” said James Lee, chief operating officer at the Identity Theft Resource Center. “Same goes for texts — anytime you get them from a number you don’t know asking you to pay, wire, or click on something suspicious.”
Lee urges consumers to hang up and call the company or institution in question at an official number.
Romance Scam Scenario
So-called “romance scams” often target lonely and isolated individuals, according to Will Maxson, assistant director of the Division of Marketing Practices at the FTC. These scams can take place over longer periods of time -- even years.
Kate Kleinart, 70, who lost tens of thousands to a romance scam over several months, said to be vigilant if a new Facebook friend is exceptionally good-looking, asks you to download WhatsApp to communicate, attempts to isolate you from friends and family, and/or gets romantic very quickly.
“If you’re seeing that picture of a very handsome person, ask someone younger in your life — a child, a grandchild, a niece or a nephew — to help you reverse-image search or identify the photo," she said.
She said the man in pictures she received was a plastic surgeon from Spain whose photos have been stolen and used by scammers.
Gift Card Request Cautions
Both Maxson and Lee said any mention of payment with gift cards should be a blaring warning alarm.
Kleinart, who experienced the romance scam, was also initially asked to send money via gift cards, with varied explanations.
“Just don’t pay people with gift cards,” Maxson said. “No legitimate company or individual is going to ask you to buy large quantities of gift cards and then read the numbers off the cards. That is exclusively a payment method of fraudsters.”
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