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FBI Reports All-Time High In Internet Fraud Losses
Posted by
Soulskill
on Fri Apr 04, 2008 01:07 AM
from the hello-sir-madam dept.
from the hello-sir-madam dept.
eldavojohn writes "While the number of cases dropped, the amount of money lost to internet fraud reached an all-time high in 2007, a new government report states. 'According to the 2007 Internet Crime Report, the Internet Crime Complaint Center (IC3) received 206,884 complaints of crimes perpetrated over the Internet during 2007. Of the complaints received, more than 90,000 were referred to law enforcement around the nation, amounting to nearly $240 million in reported losses. This represents a $40 million increase in reported losses from complaints referred to law enforcement in 2006.' The top ruses used by the fraudsters involved pets, romance and secret shoppers. The original report[Large PDF] is available online, and it contains some interesting graphs. One indicates that the two largest types of fraud are Auction Fraud and Non-delivery, which combine for over 60% of all cases. As Computerworld notes, men are more likely to fall for scams than women, and over 30% of losses are between $1,000 and $5,000. The report also contains data about the location of the perpetrators (Nigeria only accounts for 5.7%), age demographics, and contact methods."
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Still profitable (Score:3, Funny)
Yes but to put it into perspective that still accounts for 60% of the GNP of Nigeria.
And yet... (Score:5, Interesting)
Here's the irony. I called Equifax and Experian and after verifying that the information they and I had was correct, they told me I could not receive my own credit report because I did not possess the proper ID to clear myself to them... yet when I went into trucking, they were able to run a credit check on me without so much as a single complaint!
Interesting how the actual OWNER of an identity is not permitted to know what kind of data is warehoused about him or her, but everyone else pays 15 bucks and gets a full detailed copy faxed to them over insecure lines.
I think the bullshit is in the centralized repositories of standardized and aggregated information, not the fact that it is being stolen. That is inevitable when such a heavy prize is dangled at any height. Just imagine what will happen when they tie biometric (unchangeable) data to it.
Witness protection, to say the least, will take on a WHOLE new meaning. Might change name and address and "person number" once you rat on the mafia, but you won't change your DNA or retinal scan
Parent
Re:And yet... (Score:4, Interesting)
Parent
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Without regulation, it seems rather natural to me that lenders and scammers could supplant any revenue that might be had from people asking for their own credit reports by offeri
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my information isn't a publicly traded entity.
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Also:
Congress recently passed a law that entitles the citizens to request One credit report per year from ea
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http://en.wikipedia.org/wiki/ChoicePoint#Major_security_breaches [wikipedia.org]
Do you want your post to matter more? (Score:5, Funny)
pretty obvious ruse (Score:2, Insightful)
who exactly is falling for this? wow.
One solution... (Score:2)
Hell, I won't even taken them from my own family members.
New victims? (Score:5, Interesting)
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Agreed. I found it interesting how the article described different scams with inconsistent amounts of detail. For example, when the article discussed the pet scam thing, it described how an over-paying check would be mailed to a pet owner, with a request that the owner wire the difference to someone else who would be caring for the pet... only (elaborated the article) for the owner to
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1. Gain the trust of an idiot.
2. Get them to send you money.
3. Profit!!!
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Efficiency (Score:5, Insightful)
Unfair (Score:3, Funny)
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I highly doubt it.
Lies, damn lies and statistics... (Score:3, Funny)
Yes, but non-delivery of Nigerian auction purchases - HUGE.
Corporations should be held more accountable (Score:2, Interesting)
Re:Corporations should be held more accountable (Score:4, Insightful)
Financial corporations only give up on fraud when the cost of recovery is more that the amount defrauded - and sometimes even then they persue the fraudster just to set an example, for they don't want to be known as an easy mark.
They can't just raise their rates and let the customer cover it, because they have competition which might be more efficient and run them out of business.
Parent
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Re:Corporations should be held more accountable (Score:4, Funny)
Parent
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Yep, and I just knew there'd be a response from someone totally warping what I said.
In actuality, if corporations revealed fraud information rather than covering it up, it would help in the capture of the perpetrators.
all time high in stupid (Score:2)
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It was an obvious 419 scam so I replied as such. Then he replied saying "what's a 419 scam"? and I gave him a wikipedia link.
I haven't seen many of these going around lately which may be a factor. They are pretty easy to filter.
natural selection? (Score:3, Interesting)
pets scam (Score:2)
Overall I think the pet industry is aberrant and should be governed by the CDC.
Nigeria (Score:3, Informative)
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Sites need to be more accountable (Score:5, Insightful)
But when paypal or ebay get's compramised, they don't go to the police. They take absolutely no responsibility for their lack of security, and they don't even try to prevent future crimes. 120% of their work goes towards dodging blame and making the victim pay for their losses and do any paper work.
These sites are the perfect accomplices for online criminals. And they profit from it. All those fake handbags and sneakers on ebay still account for millions in listing fees and work towards their usage statistics.
The police need to investigate these crimes and send the bill to the sites where the crime occured. They should also automatically fine the criminals 20x what they stole and charge them for rent for the time they lock them up (which can be as little as 3 days, I don't think this matters).
Credit card companies are also to blame. Now it is easier than ever for buyers to file false claims and get merchandise for free. If any credit card fraud occurs, even in the smallest amounts, these cases need to be processed by law enforcement and fines need to be handed out. Too many people know they can get away with it, and keep repeating the same crime.
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The Real Culprit: Unauthenticated EFTs (Score:5, Interesting)
Back in the day when I was a young coder - that was in a whole different century, mind you - we had these paper gadgets called "checks" that couldn't be cashed unless the account holder signed them. Our banks kept records called signature cards to compare them to, to make sure the checks were legit.
Even when Automatic Teller Machines came along, you needed both a card and a Personal Identification Number to withdraw cash.
But these days, anyone who knows your routing number (bank and branch number) and your account number can initiate an EFT to rob you blind! Yes, they'll get caught eventually - but your money will be long gone.
I understand that the banking industry is losing ten billion dollars a year worldwide this way. You'd think that would be enough to get them to require some kind of authentication, but I guess the efficiency savings from not having to process paper checks makes up for it.
Small comfort to the victims though.
A friend of mine who is a professor, with a PhD and very prominent in his field, with a big grant and legions of grad students, fell for a phishing scam. They withdrew $4000 from his account. He'd never heard of phishing before. So you see, the scams do pay off sometimes.
Two surprises for me... (Score:4, Interesting)
2. Russia. Only 0.8 % of Internet Fraud comes from Russia ??? For all the bad press over the years... Is anyone else having a hard time accepting this number ?
This one answers itself. (Score:2)
Why is it that so many people automatically take as holy gospel anything written by some kid who came slouching out of some no-name college with a Journalism degree in his paw, and who probably never set foot in Russia in his life?
Law enforcement needs to grow up. (Score:5, Informative)
1) look at feedback. make sure that the seller has a positive track record.
2) if the sellers asks for cash or money orders be suspecious.
3) make sure that the contact information is valid
This kind of advise is completely misleading, because it gives the impression that caution and education are the keys to crime prevention. On the contrary, smart crooks will use these exact elements to manipulate their victims!! How? It is easy for a crook to "steal" feedback. It is easy for a crook to dodge #2, and it is also easy for a crook to emulate #3.
The bottomline is extremely simple. If someone wishes to con someone online, it is absolutely 100% doable. The only way to protect yourself is through insurance. There is absolutely no other way. The worst thing you can say to a victim is "duh, you should have known better". Sure, there are people who will fall more easily to careless cons than others. But the bottomline is still the same. There are ways of stealing identities and getting paid that are completely unavoidable. To the victims, these cases are sheer bad luck. And the criminals deserve the worst because they know what they are doing and they will most likely do it again knowing that it works.
Currently, the only viable option for insurance is credit card fraud protection. If your merchandise doesn't arrive, then just dispute the charge. This does have a huge flipside though. This same insurance that protects buyers is used for buyer fraud. Eventhough the merchandise arrived, they would call anyway and try and get their money back. For sellers, paypal's seller protection policy is the only insurance against this tactic.
All bureaucracies... (Score:2)
Why are men falling for these scams? (Score:2)
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Interesting quote (Score:2)
This is usually a sign that the persons involved are more organized and sophisticated.
After all, why scam millions and get $.02 from each one when you can scam a few, get a whole lot of money out of each, and take advantage of their unwillingness to admit they've been duped?
We're obviously talking about a group that is maximizing their profit returns on this, and we should be especially worried th
Re:A suckers born every second. (Score:4, Interesting)
Scam's are much easier to pull off over the net, and I don't think it's a matter of suckerdom as much as distance and ease of pulling it off. There are plenty of legitimate businesses online, this is the first time I have been defrauded.
Parent
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- your buyer uses counterfeit money order (no money for you)
- your buyer claims non-receipt (instant refund if you can't prove delivery)
- your buyer pays with stolen card (money gets sucked out of your account)
As a buyer, it's extremely easy NOT to be scammed:
- use paypal
- use credit card
- return item with Confirmed Delivery
I've found it extremely easy to return damaged items to a seller (even when the seller refused), and then file a claim with both Paypal
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I'm not going to waste $50 of my money mailing a broken brick back to a Known Scam Artist (which he would then pawn off on some other poor soul). Especially since the refund was only $70, which means I'd net just $20 refund!!! Nope; not gonna do it; wouldn't be prudent at this juncture.
Re:A suckers born every second. (Score:5, Funny)
*raises hand*
I bought Vista from an online retailer. The copy was completely legit, but I still felt scammed. And a little dirty.
Parent
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That's because, as the article says:
The other 40% is Windows.
Re:The secure way to store your money. (Score:4, Insightful)
Parent
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I don't have any gold now but I'm planning on getting some. It's the only way type of wealth that keeps its value, even if the paper system collapses and/or banks close & take your money with them.