Scams are fraud, a criminal activity designed to trick someone out of money or personal details.
Methods constantly evolve as scammers look for new ways to commit fraud and avoid detection.
Consumers might be contacted by telephone, post, email or even on their doorsteps. In the long
history of scams, the internet is a relatively new way for fraudsters to target potential victims and
they have been quick to reinvent old tricks for new digital platforms. Scammers are often considered
to be the lowest of the low when it comes to attackers. They use many of the same techniques con
artists have used for decades. The scammers that are caught and discussed publically often do not
have the technical skill with attack tools of even the worst of script kiddies, as they prefer other
methods of gaining their target information. Such scammers instead use tools that are of a social
engineering nature, such as phishing or pharming attacks, in order to trick their victims into willingly
parting with the information that they wish to obtain. The goal of scammers is to separate their
unwitting victims, often those that are not technically savvy, from their PII, including names,
addresses, social security numbers, financial data, and other such information. Given this
information scammers will seek to drain the victim’s bank accounts and run their credit cards up to
the limit, often moving such funds out of the country where they cannot be recovered easily.
Internet fraud is a type of cybercrime fraud or deception which makes use of the Internet and could
involve hiding of information or providing incorrect information for the purpose of tricking victims
out of money, property, and inheritance. Internet fraud is not considered a single, distinctive crime
but covers a range of illegal and illicit actions that are committed in cyberspace. It is, however,
differentiated from theft since, in this case, the victim voluntarily and knowingly provides the
information, money or property to the perpetrator. It is also distinguished by the way it involves
temporally and spatially separated offenders. With your personal information, scammers can access
and drain your bank account, open new bank accounts in your name and take out loans or lines of
credit, take out phone plans and other contracts, purchase expensive goods in your name, steal your
superannuation, gain access to your government online services, access your email to find more
sensitive information, access your social media accounts and impersonate you to scam your family
and friends.The aim of a scam is to trick people into parting with money or revealing sensitive
personal data - such as email addresses, passwords and birth dates - to facilitate ID theft (known as
‘phishing’), which can then be used for financial gain. However, approaches can vary. Most scams fall
into three broad categories. E-commerce scam which is fraudsters claim to be genuine online sellers,
on sites such as Facebook Marketplace. Consumers pay for goods, which then turn out to be
counterfeit (e.g. fake clothing or gift vouchers) or poor quality (e.g. faulty or substandard). In some
cases, goods simply never arrive. Investment scam - fraudsters advertise a ‘too good to be true’
investment opportunity, sometimes using news stories and advertisements that appear to be from
genuine sources. Consumers who are tempted to invest lose some or all of their money. Impostor
scam is fraudsters pose as authentic brands, genuine friends or family, to gain a consumer’s trust
asking them to purchase goods, send money or click on links which download malware to their
computer.
Scams have the potential to cause great harm to consumers and financial losses can be potentially
life changing. According to the FBI's 2017 Internet Crime Report, the Internet Crime Complaint
Center (IC3) received about 300,000 complaints. Victims lost over $1.4 billion in online fraud in 2017.
According to a study conducted by the Center for Strategic and International Studies (CSIS) and
McAfee, cybercrime costs the global economy as much as $600 billion, which translates into 0.8% of
total global GDP. Online fraud appears in many forms. It ranges from email spam to online scams.
Internet fraud can occur even if partly based on the use of Internet services and is mostly or
completely based on the use of the InternetConsumers International member which recently
reported on bank impersonation scams that lost 19 victims almost £350,000 between May 2018 and
January 2019. Evidence from other Consumers International members suggests that the amount of
money being lost per scam is increasing. For example, data from the Australian Competition and
Consumer Commission shows that, despite reported social media scams remaining fairly static over
the last few years, the amount of money lost quadrupled between 2015 and 2018, from $3.8 to
$13.1 million AUS dollars. The Canadian Anti-Fraud Centre reports similar trends,with complaints of
fraud decreasing, while total losses increase. In addition to financial losses, victims of scams can be
affected mentally and emotionally. They may feel ashamed and suffer from social isolation, which
can affect their interactions with others. It can also degrade consumer trust in digital marketplaces,
social media platforms and genuine brands, affecting future online behaviour and interactions. It is
important to note that social media scams can have a negative impact on brands as well as
consumers. Impostor scams, where criminals pose as authentic brands, reviewers and well-known
figures to trick consumers out of money can cause reputational damage to the individual or
organisation being impersonated.
