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-Editorial
Did someone tell you to move or transfer your money to “protect” it? Did they claim to be from a government agency like the FTC or the Social Security Administration, or a well-known company like your bank, Amazon, or Microsoft? If so, you’ve likely encountered a scam.
The Federal Trade Commission (FTC) has reported a dramatic increase in impersonation scams, which have emerged as a leading form of fraud in the United States. In the first half of 2024 alone, nearly 360,000 reports were filed, significantly surpassing any other type of fraud. These scams resulted in over $1.3 billion in losses, with the median loss per victim estimated at $800, according to Kati Daffan, Assistant Director of the FTC’s Division of Marketing Practices.
“Scammers are evolving rapidly, and their tactics are constantly changing,” Daffan stated during an Ethnic Media Virtual Briefing. She noted that these scams often begin with a call or message about a seemingly routine issue, such as suspicious account activity. However, the narrative quickly escalates, creating a sense of urgency that manipulates victims into drastic actions, such as transferring money via bank transfer or cryptocurrency ATMs.
Scammers frequently impersonate trusted entities to instill fear and urgency. Daffan pointed out, “Tag-team scams blur the lines between business and government impersonation, leading people to believe they are protecting their money.” A common example involves victims receiving fake text messages from companies like Amazon, alerting them to unauthorized charges. One victim recounted receiving a message about a $1,499 payment for an Apple MacBook Pro. When they called the number provided, they were connected to scammers posing as Social Security officers and U.S. Marshals, who convinced them to withdraw cash and deposit it into a Bitcoin ATM.
In response to this growing threat, the FTC implemented the Impersonator Rule on April 1, 2024, making it illegal to falsely pose as a government entity or business. The FTC has already initiated legal action, including a case against Panda Benefit Services, LLC, for violating this rule.
“Only scammers will ask you to pay through bank transfers, cryptocurrency, or gift cards,” Daffan cautioned. She urged consumers to remain vigilant and report any suspicious activity to the FTC at ReportFraud.ftc.gov.
The top five impersonation scams currently include fake security alerts from banks, phony subscription renewals, fraudulent giveaways, threats of legal trouble, and fabricated package delivery issues. The FTC continues to educate the public on how to recognize and avoid these scams, emphasizing that legitimate entities will never demand immediate payment or instruct individuals to move their money for “protection.”
Emma Fletcher, Senior Data Researcher at the FTC, revealed alarming statistics that underscore the prevalence of impersonation scams. “This is just the tip of the iceberg; research indicates that less than 5% of people who experience a scam report it,” she explained.
Fletcher attributed the rise in these scams to the evolving tactics employed by fraudsters, many of whom impersonate well-known businesses or government agencies.
A concerning trend highlighted by Fletcher is the blurring of lines between various types of impersonation scams. Often, scammers start by impersonating a business, such as a bank, and then escalate to involving government agencies. “Their goal is to heighten emotions and create a sense of urgency, making it difficult for victims to think clearly,” she said.
Fletcher concluded by urging the public to remain vigilant, as scammers are employing increasingly sophisticated methods, including the use of cryptocurrency and bank transfers for illicit gains. “Scammers position themselves as helpers, leading victims to believe they are protecting their money, which ultimately results in significant losses,” she stated.