The Federal Trade Commission, the federal government's arm enforcing consumer protection laws, reported that Americans lost more than $6 billion to online scams in 2022. More than 2.9 million people said losing a median of $650.
During 2021, consumers lost more than $5.8 billion, a median of $500. That number will likely increase during 2023, following the January and February spike in reported cases of online spam.
Identity theft is currently the main form of online scam in the U.S. It primarily affects e-commerce with low-security measures in their payment gateways.
Identity theft occurs when someone steals personal and sensitive information such as your name, address, credit cards, bank account numbers, or medical insurance card numbers and uses the data to buy with stolen credit cards or open new ones, open utility accounts, or steal a consumer's tax refund.
According to the Federal Trade Commission, the main forms of the online scams are the following:
The FTC’s Consumer Sentinel Network (Sentinel) is a database that receives reports directly from consumers and federal, state, and local law enforcement agencies, the Better Business Bureau, industry members, and non-profit organizations.
Twenty-five states now contribute to Sentinel. Reports from around the country about consumer protection issues are a key resource for FTC investigations that stop illegal activities and, when possible, provide consumer refunds.
Sentinel received more than 5.7 million reports in 2021 and over 6 million reports in 2022; these include the fraud reports detailed above, identity theft reports, and complaints related to other consumer issues, such as problems with credit bureaus and banks and lenders. In 2021, nearly 1.4 million reports of identity theft were received by the FTC.
The FTC uses the reports it receives through Sentinel as the starting point for many of its law enforcement investigations.
The agency also shares these reports with approximately 2,800 federal, state, local, and international law enforcement professionals. While the FTC does not intervene in individual complaints, Sentinel reports are vital to the agency’s law enforcement mission.
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