BBB report finds spike in new type of scam, costing consumers thousands of dollars

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INDIANAPOLIS, Ind. — An annual report compiled by the Better Business Bureau found a newly created category of scam to be among the riskiest, with consumers reporting high losses of money.

In the fourth edition of the BBB’s Scam Tracker Risk Report, cryptocurrency appeared for the first time as its own category of scams, rocketing to the No. 2 spot for riskiest scam. People who fell for cryptocurrency scams most often reported losing around $3,000.

The report, which analyzes 37,000 scam reports made nationally through the BBB’s online Scam Tracker tool, uses a ‘risk index’ that combines the prevalence of a scam with how often people fall for it and how much money they lose.

Employment scams were labeled the #1 riskiest in 2019, followed by cryptocurrency, online purchases, fake checks/money orders, and advance fee loans.

Better Business Bureau of Central Indiana CEO Tim Maniscalo warned that the top three categories all largely involve transactions made on the internet.

“The problem with online purchases is that anybody can create a website,” Maniscalo said.

Maniscalo warned that you should be careful who you do business with online because tracking a scam on the internet can prove difficult, making it unlikely you’ll get your money back.

Within the category of cryptocurrency scams, there were multiple ways people reported losing money. Those included virtual coins that were used to buy or exchange goods, which turned out to be fake, as well as offers of investment in cryptocurrency.

One victim quoted in the report said he was contacted by someone via an Instagram message who told him that by depositing money into her Bitcoin account, he could “watch the money increase.” He later found himself unable to withdraw his “earnings,” ultimately losing about $1,200 to the scam.

You should be especially careful about offers to invest in new types of cryptocurrency.

“You just want to make certain it’s not something that is kind of a fly-by-night sort of proposition that someone is putting out there, that they really do have some sort of plan and some sort of financial backing,” Maniscalo said.

The BBB report found that while men and women were about equally susceptible to fall for a scam, men typically lost about $100 more.

There was some good news for the Midwest region, where the median loss among victims was the lowest nationwide, at $115. Romance scams were deemed the riskiest scam in the Midwest.

You can read the BBB’s full report at the link here.

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