Cash-grabbing "hit-and-runs" are also on the rise among top scams in 2014 and 2015: Internet Scambusters #627
Find out about the top scams of 2014 and our predictions for 2015 in our annual Top 10 report in this week's issue.
We let you know which scams are moving up the charts and call for special vigilance and explain why identity theft remains the number one threat.
Plus, we have a warning from the FDA about bogus Ebola treatments.
Now, here we go...
Identity Theft Holds Pole Position in Top Scams List
Nothing's going to shake identity theft from the Number 1 slot in our annual list of top scams, but the huge growth in what we call hit-and-run scams is changing the shape of our Top 10 chart as we move into 2015.
We compile our charts each year based on our own research findings and the flow of news from law enforcement and consumer agencies.
Now, we're picking up more and more reports of hit-and-runs -- scams in which victims are tricked into handing over money they don't owe for everything from bogus fines and unpaid taxes to supposedly unpaid utility bills.
Often, these pay-up demands come by phone and a new report published towards the end of 2014 claimed Americans lose almost $9 billion every year in various phone scams.
Sadly, this figure is likely to be dwarfed by the amount that identity theft scams are costing the nation.
So let's take a look at how the Top 10 chart looked at the end of the year, with our 2013 forecast in parentheses:
1. (1) Phishing and ID theft. Hack attacks and record-level data breaches at big retailers and other organizations led to hundreds of millions of credit card details being exposed in 2014. The effects of this could last for years.
2. (2) Lottery and sweepstakes. Despite widespread publicity, crooks still duped many thousands of people into believing they'd won a lottery fortune and then paying a fortune to try to get their winnings.
A particularly sneaky trick was the use of the legitimate Publishers' Clearing House name to add credibility to scams
3. (5) Hit-and-run scams. As we said earlier, this scam is growing fast. Biggest culprit was the so-called arrest warrant scam, where victims are told they must immediately send a money wire to avoid arrest for any one of a range of phony offenses, like failing to turn up for jury duty or simply receiving a speeding ticket.
4. (3) Malware. Although downloads of malware are still running at high levels, law enforcement agencies enjoyed some modest success in 2014 in taking down "bot-nets" that distribute some of these harmful programs -- though they predicted the criminals would quickly be back in action.
5. (6) Grandparent/imposter scams. With all the publicity covering unfortunate victims who are tricked into believing they must send money to a friend or relative in trouble, we didn't expect to see this scam strengthen quite as much as it did in 2014.
The message of always checking out these distress stories is clearly still not getting through, particularly with older folk.
6. (4) Bogus Internet sites and fraudulent online sales. This crime has only slipped down our charts because other scams are growing faster. It's still a biggie.
7. (8) Advance fee scams. This is the con trick in which victims receive a check as a supposed advance payment for work or a product or service, with a request to forward part of the sum to a third party.
The check is bogus and the third party is the scammer, who disappears with his money before the check "bounces."
The money-wiring companies have tried to clamp down on this but online job advertising and the growth of a favorite target -- small businesses -- has pushed this up a notch in our charts.
8. (7) Economy-related scams. We think the slowly recovering economy has helped eliminate some of the bogus job scammers and phony loan fixers but there are still plenty of foreclosure scams about.
9. (9) Investment scams. There are always hundreds of schemes that seem to promise big returns with low risk and there are always thousands of people who fall for them and lose their money.
With interest rates remaining at historically low levels, some people just can't resist the get-rich-quick lures.
10. (10) Dating and sweetheart scams. As more and more people use the Internet to find a partner, so the scammers continue to pose as lonely hearts who supposedly just need some of your money to solve a short-term financial crisis.
Forecast for 2015
So, what's likely to change in the scam charts in 2015? Many of the old-familiars will likely remain firmly entrenched but we do see further growth in the hit-and-run scams slot and the possible appearance of healthcare related scams.
Here's our predicted countdown, with 2014 figures in parentheses:
1. (1) Phishing and ID theft. Sadly, we think the gap may widen even further between ID theft and other scams.
The outlook for data protection is not good with the residue of past breaches, new ones, and hack attacks on newly digitized health records all adding to the woes.
2. (3). Hit-and-run scams. This makes quick and easy money for the scammers with little or no risk. Don't be surprised if a phone caller demands a wire payment from you -- just hang up!
3. (2) Lottery and sweepstakes. Here's hoping the message finally starts to get through to the public, especially seniors, about this trick. But progress will be slow.
4. (4) Malware. This will remain a persistent threat but we expect to see a further switch in emphasis to malware downloads on smartphones, notably those using the Android operating system.
If you're an Android user, install a reputable security app and don't install downloads from unofficial sources.
5. (6) Bogus online sites and telesales. This year we're adding in telesales to this category. The worrying feature is the growth of illegal robocalls by scammers who don't care a bit about the Do Not Call Registry.
Look out for more free air ticket scams (usually an advance fee trick) and bogus "survey" calls (usually a disguised sales call).
6. (5) Grandparent/imposter scams. As with lottery scams, we think further, increased publicity could help reduce the level of this scam.
7. (7) Advance fee scams. Don't expect to see any easing in the incidence of advance fee scams. In fact, we may see some growth in double-scams where people are asked to pay upfront to supposedly recover money they lost in an earlier scam.
8. (-) Healthcare and Affordable Care Act (ACA) scams. This is our newcomer for the year. In 2014 we reported on the "free medical alert" scam.
Now there's evidence of con artists trying a whole new range of tricks by claiming either they're working on behalf of Medicare or offering cheap ACA insurance, which turns out to be non-existent.
You can learn more about these ACA scams in next week's issue.
9. (8) Economy-related scams. Even if the economy picks up, the huge expansion in self-employment and small businesses has created a stack of potential victims for the crooks, so this category is not ready to drop out of the charts just yet.
10. (9) Investment scams. Interest rates could start to rise in the coming months, which could make some phony investments less attractive. But if inflation begins to rise, expect to see more gold and bullion scams. Meanwhile, any turbulence in currency markets could lead to more scams in this category.
That's it for our 2015 stargazing. Whatever the final outturn for the top scams of 2015, the one thing we can be sure of is that the crooks will keep the chart bubbling.
Alert of the Week
Following the scary Ebola disease outbreak, mainly in Africa, the U.S. Food & Drugs Administration (FDA) is warning about bogus treatments and therapies for the illness.
Although there are experimental vaccines, at the time of this writing there are no proven vaccines or cures for Ebola, and when there is we'll hear officially from the FDA. So, don't buy!
That's it for today -- we hope you enjoy your week!