Common Financial Crimes Targeting The Public And How To Prevent Them

Some people would do anything for love — and that’s just what con artists are banking on.

In 2022, romance scammers conned an estimated 19,050 victims who reported losing more than $739 million to those determined to take financial advantage of their love, according to a preliminary report from the FBI’s Internet Crime Complaint Center.

“The criminals who carry out romance scams are experts at what they do and will seem genuine, caring, and believable,” the FBI said of the scams. “Con artists are present on most dating and social media sites.”

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The scams are just one type of financial crime targeting the unsuspecting public, who can also fall victim to identity theft, elder fraud, merchandise scams, credit card fraud or the newly emerging cryptocurrency scams.

Victims of fraud often face shame and embarrassment which causes the crimes to be drastically underreported.

According to the U.S. Attorney’s Office in the Western District of Washington, it's estimated that only 15 percent of the nation’s fraud victims ever report their crimes to law enforcement.

“Many victims feel they only have themselves to blame, when in reality, calculating, skilled perpetrators are to blame for these criminal acts,” the department said of the crimes, which they described as a “personal violation.”

While anyone can fall victim to these crimes, experts say con artists may target certain groups based on their age, education level, gender or financial position. It’s important to stay knowledgeable about the schemes to avoid becoming a criminal’s latest victim.

Here are some common financial crimes targeting the public:

The most common type of consumer fraud in 2021 was categorized as imposter scams, or schemes wherein the scammer pretends to be someone you trust to gain your money, according to the Federal Trade Commission (FTC).

Romance scams are a common example of this. Savvy criminals pose as someone interested in building a genuine romantic relationship, often meeting their victims through dating or social media sites. Over time, however, they begin to ask for money under false pretenses and may tell the victim they need the money for medical, travel or legal fees, according to the FBI.

“Online dating is common today, but unfortunately scammers also thrive on those same sites,” said Sherri E. Onks, Special Agent in Charge of FBI Jacksonville, in a statement put out by the FBI. “Whether you’re looking for love or a friendship online, be sure you first understand the risk of being exploited. Remember, a scammer will always eventually ask you for something, so set a boundary early on and never, ever send money to someone you’ve never met.”

Other types of imposter scams include posing as an employee with the Social Security Administration (SEC), the IRS or a tech company employee offering to help you fix your computer. In all the scenarios, the scammers want the same thing: your money.

Scammers may even try to entice their victims by claiming they’ve won the lottery, sweepstakes or an amazing prize. According to the FTC, one easy way to spot these scams is if the contact insists you have to pay for your prize, mentions that your odds would increase if you paid or asks for your bank account information before delivering the prize or earnings.

The FTC also encourages the public to be wary of anyone claiming to be from a governmental agency asking for money over the phone. Government agencies would not do this. Scammers can even fake caller ID, so authorities say its best to look up the phone number of the real agency or company and call using that number to check into anything suspicious.

Photo: Getty Images

Imposter scammers often specifically target older adults in an attempt to steal their money or property. One prevalent scheme, known as the Grandparent scam, goes as far as having the criminal pose as a grandchild seemingly in danger and needing financial help, whether it's help with bail money or money for transportation.

“The scammer may already know a lot about you or the person they’re pretending to be,” the FTC said in a warning about the scam. “They may know your name, where you live, and other information they could have found on social media sites or by hacking a family member’s email. And sometimes they simply guess.”

Before sending any money, experts say those targeted need to hang up and confirm with other family members about any requests for money.

Elderly adults may also be susceptible to people pretending to be offering home improvement services that they never provide or those who may pose as a caregiver to steal their money or belongings.

“Every day, this Office sees the financial ruin and emotional devastation inflicted on elderly victims by scams and fraud schemes,” United States Attorney Zachary A. Cunha said at a training program earlier this year. “The most recent FBI statistics are staggering: in 2021 nearly 100,000 American seniors reported being defrauded by scammers of $1.7 billion dollars. That’s more than just a statistic — it’s a life changing event that many never recover from, and we are determined to leverage our resources to bring to justice those who prey on our elderly and vulnerable friends and neighbors.”

Much like its name implies, identity theft is when someone attempts to be you and uses your personal information — whether it's your name, social security number or credit card number — without your permission, according to the Office of the Comptroller of the Currency.

Once they’ve stolen your identity, they can use that information to open banking or checking accounts or make unsanctioned purchases.

According to a 2022 report from the FTC, 25% of all reports to the agency’s Consumer Sentinel Network — a database available to law enforcement that tracks trends — were about identity theft, making it the most commonly reported offense.

To prevent becoming a victim yourself, the Texas Attorney General’s Office recommends keeping your personal information — including Medicare cards, social security information and credit cards — in a safe place, shredding receipts and credit card offers and using different passwords for your online accounts.

“One of the most effective ways to protect against identity theft is to monitor your credit reports and billing statements so you can spot and report unauthorized activity,” they wrote.

If you believe you may have been a victim of identity theft, the FTC recommends placing a credit freeze or fraud alert on your credit report, closing your account and reporting it to the proper authorities.

With the growing online shopping trend, consumers can also fall victim to merchandising scams, designed to collect your money without ever delivering the product.

According to the FTC, most things you purchase through the mail, online or over the phone are all subject to the same rule which requires sellers to either ship a purchased item within the advertised timeframe or within 30 days, if no timeline is given.

If there is a delay to shipping a product, the seller must notify you and either give you the option to cancel the order and get a refund or agree to wait the additional time.

If you never receive the product, the FTC recommends disputing the charge on your credit card within 60 days of receiving your billing statement. They also recommend researching the company’s reputation or reading reviews before placing an order and reporting any scams to the FTC at ReportFraud.ftc.gov.

One new type of scam involves cryptocurrency, a term used to describe digital currencies like Bitcoin or Ether that exist only online.

Investigators are seeing more scams pop up where criminals are asking their target to pay in cryptocurrency. These can be investment scams that promise investors can “make lots of money” with “zero risk” by buying cryptocurrency and transferring it into their online account, according to the FTC. However, when the target logs into their “investment account” they aren’t able to withdraw their money.

They can also be intermingled with romance scams, where a love interest asks their intended target to send cryptocurrency.

According to the FBI, authorities expect higher reported financial losses for victims of romance scams in 2023 as a result of a “trend in International Crypto Investment Fraud.”

To avoid becoming a victim of a cryptocurrency scam, the FTC recommends avoiding any arrangements where the person insists on being paid in cryptocurrency.

“No legitimate business is going to demand you send cryptocurrency in advance — not to buy something, and not to protect your money,” authorities said.

They also recommended steering clear of anyone promising guaranteed profits or big returns and cautioned against sending anyone cryptocurrency that you’ve met through a dating site or app.

To learn more about crimes motivated by greed, check out the new Oxygen series "Blood & Money," premiering Saturday, March 11 at 9/8c.