INDIANAPOLIS – The Better Business Bureau just released its annual Scam Tracker Risk Report for 2020.
The report details which scams were the most prevalent during the pandemic, who fell for scams the most and how much money households lost on average.
“We take all of the reports that we get on our Scam Tracker website and then compile those and look to see the trends in scams,” said Tim Maniscalo, the president and CEO of the BBB Central Indiana. “It was thousands of scams and this is only what’s reported to us, so we think that’s kind of the tip of the iceberg.”
The biggest & riskiest scams in 2020
The BBB found that Americans fell for at least 46,575 scams in 2020. That number was up almost 25% from 2019. At least 33% more people fell for scams and lost money. On average, people who fell for scams lost about $115.
“We actually saw COVID-related scams go way up,” Maniscalo explained. “The big one we saw were what we would call online purchase scams. Those are scams where either a popular company or website is impersonated or there is a website that let’s say, sells electronics, jewelry, expensive items and those items either never appear or they are very low quality. For instance, you’ll get a designer purse–supposedly–for 75 bucks. It’s really not a designer purse. It just has the logo on it.”
Maniscalo wasn’t surprised by this. He said because more people shopped online in 2020, scammers knew exactly who to target.
“I think a lot of things, culturally, have changed for us with COVID. One of those is that we’ll be relying more on our devices and our computers. Scammers know that and they’re going to take advantage of that,” he said.
Another big scam, according to the BBB, was pet scams.
“That’s where people go online, they will see these adorable pets, adorable puppies and want to get that and then when they go through that process, pay their money. “They say, ‘Gee, the pet is coming from outside the country.’ Then, there is this endless line of excuses about, ‘Hey, the pet is sick or there is some sort of importing fee.’ Anyway, the pet never shows up,” Maniscalo detailed.
The BBB said scammers in those cases will keep people paying until the consumer figures out it’s a scam.
It happened to Carmel resident Amber Chester. She told CBS4 that she had paid $800 for a kitten in Colorado. Later, she was told there was a problem at the airport and that she would have to pay an additional $1,000.
“It was, after that, where they started with the emails on, ‘Well, there’s this animal tax that is going to cost another $4,000 to $5,000.’ And at that point, I was like, ‘Wait a second. No more money. You’re not getting another penny out of me. Where is my cat?’” Chester recalled.
Chester ended up finding a breeder in Southern Indiana and meeting her in person before purchasing a different cat.
“I knew better. I really, really did, but I was so emotional about it that I let the emotions take advantage of the logic,” she warned.
The BBB said pet scams likely went up in 2020 because so many people were looking for companions while they were home in quarantine.
Scammers also used products to scam people. Often, fraudsters tried to pawn pet supplies and medical and nutrition supplies, which included personal protective equipment like face masks. About 82% of people who were exposed to such product scams lost money.
Among the top ten riskiest scams in 2020, the BBB listed online purchase scams, employment scams, fake check/money order cams, advance fee loan scams, home improvement fraud, romance scams, cryptocurrency scams, tech support scams, travel/vacation and timeshare scams, and investment scams.
Who fell for scams the most in 2020
The Better Business Bureau broke down the demographics of its risk report as well. The organization said younger people lost money to scammers more than those who are older.
“That’s because most scams come through the internet,” Maniscalo explained. “Younger people will use the internet, trust the internet and give a lot of personal information on the internet and that is used against them.”
For the first time ever, though, the BBB said people ages 18-24 lost the same amount of money as those 65 years of age and up.
Romance scams continued to be the riskiest scam specifically for people ages 55-64. Travel/vacation and timeshare scams were the riskiest for people 65 years of age and up.
“What about men versus women?” news anchor and investigative reporter Angela Brauer asked.
“They’re scammed at about the same rate but if you look at the average loss, men versus women, men lose more money than women,” Maniscalo said.
The BBB couldn’t speculate as to why that was the case in 2020.
The agency also pointed out that women lost less money than men. On average, females lost about $105 per scam. They tended to fall for online purchase scams, romance scams and employment scams. Men lost about $168, typically to online purchase scams, employment fraud and home improvement scams.
When it came to racial background, the BBB surveyed thousands of people who reported scams in 2020. It said about 79% of people self-identified as white, about 11% identified as Black, 6.8% said they were Hispanic/LatinX, 3.8% identified as Asian and 2.3% responded that they were American Indian/Alaska Native.
How to avoid falling victim to a scam
There are two common ways Americans can protect themselves and their finances. First and foremost, if you are doing anything online, make sure the website you are visiting is secure.
“Look for in the URL bar the letters ‘HTTPS.’ The ‘s’ is the important letter there. Look for the little lock icon, too. That says that the website has been registered and there is additional safety,” Maniscalo said.
Secondly, it’s best for consumers to pay for products or services with a credit card. That will provide additional security. In some cases, credit card companies can reverse the charges.
“If you get some sort of unsolicited offer, either through social media or email and it really sounds great, be careful of that,” Maniscalo warned. “And if you see something online that is just an incredible price, once again–a designer good that is way below what you would normally pay for something–it’s probably too good to be true.”
Often, the scammers in these cases are overseas. Once someone loses their money, that cash is gone for good. Law enforcement has had a difficult, if not near impossible, time tracking down those responsible.