Millions of Americans still falling for scams
Weight-loss programs and prize promotions are the biggest offenders
Thursday, April 25, 2013
Have you been scammed? If so, you have a lot of company.
The Federal Trade Commission (FTC) has released a statistical survey showing that an estimated 25.6 million American adults -- 10.8% of the adult population -- were fraud victims.
“The FTC fights fraud every day by taking scammers to court and telling consumers how to avoid being scammed,” said Charles Harwood, acting director of the FTC’s Bureau of Consumer Protection. “Studies like this one help us fine-tune both our enforcement and education efforts.”
Online commerce has been a boon for consumers, giving them greater choice and convenience. However, it cuts both ways. The FTC survey indicates that, as of 2011, the Internet was also the place where consumers most often learned about fraudulent offers.
The Internet category, which included email, social media, auction sites and classified ads, was followed by print advertising, and TV and radio. Most consumers were scammed via the World Wide Web. Telephone purchases ranked second.
The survey asked consumers about 15 specific categories of fraud, and two general categories. Of the specific categories the top 10 were:
- Weight-loss Products (5.1 million estimated)
- Prize Promotions (2.4 million est.)
- Unauthorized Billing for Buyers’ Club Memberships (1.9 million est.)
- Unauthorized Billing for Internet Services (1.9 million est.)
- Work-at-Home Programs (1.8 million est.)
- Credit Repair Scams (1.7 million est.)
- Debt Relief (1.5 million est.)
- Credit Card Insurance (1.3 million est.)
- Business Opportunities (1.1 million est.)
- Mortgage Relief Scams (800,000 est.)
Most likely to be cheated
An estimated 17.3% of blacks and 13.4% of Hispanics were victims; the rate for non-Hispanic whites was 9%. The survey found that high school graduates were the least likely to have been fraud victims; those who did not complete high school were the most likely to have been victims.
Consumers who were more willing to take risks and those who had recently experienced a negative life event (such as a divorce, death of a family member or close friend, serious injury or illness in their family, or the loss of a job) were much more likely to have been victims. Consumers who indicated they had more debt than they could handle were significantly more likely to have been fraud victims than those who were more comfortable with the amount of debt they had.
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