Fraud Cost Americans $5.8 Billion in 2021 | Digital Guardian

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Fraud Cost Americans $5.8 Billion in 2021

by Chris Brook on Wednesday February 23, 2022

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Americans lost more than 70% more to fraud last year than the year before, proof that tactics used by scammers from the early days of the pandemic are still working.

As the Federal Trade Commission continues look back on 2021, parceling out new information from the last year around identity theft, social media scams, and other online threats, one thing is clear: The tricks cybercriminals started using in the pandemic's infancy are working better than ever.

This week the agency shared new statistics on how much money Americans lost to fraud last year. The number - $5.8 billion – marks a massive 70% increase from the year before, when the FTC said that $3.3 billion had been lost by consumers through fraud.

Looking back, the numbers around fraud really surged from 2019 to 2020; fraud accounted for $1.8 billion in 2019. While the $1.8 to $3.3 billion spike can be attributed to the scores of Americans who began working from home (and the challenges that came with it) in the early days of the COVID-19 pandemic, 2021’s numbers suggest attackers capitalized on those routines, many which continued last year, to great success.

Attackers had luck across the board it seems; $2.3 billion of the $5.8 billion was due to imposter scams, up from $1.2 billion in 2020. Online shopping scams accounted for $392 million, up from $246 million in 2020. Other forms of fraud included phony prizes, sweepstakes, lotteries, along with bogus internet services and business and job opportunities.

The FTC arrived at the numbers by looking at stats from its Sentinel network, a database it maintains on consumer reports about fraud, identity theft, and other issues. The database, which is made available to law enforcement to carry out investigations and spot fraud trends, also includes reports from other federal, state, local, and international law enforcement agencies, along with organizations like the Better Business Bureau and Publishers Clearing House. Sentinel took in 5.7 million reports last year; 2.8 million of those related to fraud, up from 2.1 million in 2020.

The numbers on fraud are the latest provided by the FTC to give the public an idea of how costly online scams can be.

Last week the FTC dug into numbers around romance scams, scams in which consumers are often tricked by fake dating profiles. In these scams, which accounted for $547 million last year, things can escalate quickly and ultimately lead to the attacker asking the victim to wire them money or nowadays, cryptocurrency.

In January the FTC shared that Americans lost $770 million from social media scams last year, a figure that’s 18 times larger than what Americans lost just five years ago in 2017.

Tags: Fraud

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Chris Brook

Chris Brook is the editor of Data Insider. He is a technology journalist with a decade of experience writing about information security, hackers, and privacy. Chris has attended many infosec conferences and has interviewed hackers and security researchers. Prior to joining Digital Guardian he helped launch Threatpost, an independent news site which is a leading source of information about IT and business security for hundreds of thousands of professionals worldwide.