Fraud perpetuated by international scammers have cost Americans a fortune. Thanks to a Federal Trade Commission report filed this week, we now know exactly how much.
In the period between January 1, 2015, to June 30, 2023, American consumers have reported $2.49 billion in losses related to so-called cross-border fraud, with nearly half a million incidents, according to a FTC report compiled as part of the Undertaking Spam, Spyware, and Fraud Enforcement with Enforcers beyond Borders Act of 2016 (U.S. SAFE WEB).
The report offers a glimpse into the magnitude of the problem, the most prevalent types of scams and where they originate from, and what the FTC is doing to protect consumers. The agency believes these reported numbers are just the tip of the iceberg of the problem, which could actually be much, much larger.
“These figures, already staggering, almost certainly understate the true amount of cross-border fraud that consumers face. Only a small percentage of consumers who encounter fraud file complaints, and the cross-border aspects of many frauds are not always apparent to the consumers themselves,” the report said.
The FTC’s report showed that incidents began to rise during the pandemic in 2020, with complaints spiking in 2021 with 365,731 complaints, before dropping to a still-high level last year. This year is tracking to be slightly higher than 2022.
From a monetary perspective, 2022 was a watershed year, with $784 million in U.S. consumer losses reported. The average loss per incident was $511. This year is on track for consumer losses of $598 million, with an average loss of $400 per case.
China is the largest source of reported overseas scams, followed by Canada and then the U.K. The report notes that consumers will face different scams based on the country of origin. For instance, online shopping scams typically come out of China and Canada, while investment fraud, including seminars and bad advice, come out of the U.K. Imposter scams involving people who pose as tech support or romantic partners are connected to India and the Philippines. Scams involving people posing as family or friends come out Mexico.
The cross-border scams go both ways, with the FTC report noting that since 2019, 61% of all cross-border complaints filed to the FTC came from foreign consumers about U.S. entities.
The numbers are a reminder to be on your toes about the people who contact you, and to watch out for suspicious emails, texts and phone calls. Given the increased rate of incidents, chances are it might be a scam.