Fast-growing investment scams linked to cryptocurrency
February 1, 2022
Media contact: National Consumers League – Carol McKay, email@example.com or (412) 945-3242
Washington, DC—Being a fraud victim in 2021 was likely to cost more money than at any time in the last 10 years, according to a new report from the National Consumers League (NCL), which runs Fraud.org. In 2021, the median fraud loss reported to the NCL Fraud.org campaign hit a 10-year high of $800, according to the organization’s annual Top Ten Scams Report. Although the percentage of complaints involving financial loss (41.49 percent) took a slight dip from the previous year (47.48 percent), consumers who lost money reported losing it in greater amounts. The median loss by victims was up $150 in 2021, according to the organization, which analyzed more than 4,300 complaints filed by consumers online, over the phone, and via postal mail.
“What this data tells us is that scammers are getting better at extracting more money from their victims,” said John Breyault, NCL vice president of public policy, telecommunications, and fraud and the director of the Fraud.org campaign. “We remain concerned that consumers facing economic difficulty and isolation from friends and loved ones due the pandemic are creating fertile ground for crooks.”
The top complaint category reported to Fraud.org in 2021 was bogus prizes, sweepstakes, and “free” gifts. Complaints about such scams made up more than one in three (35.23 percent) complaints captured at Fraud.org, an increase of 48 percent year-over-year. Echoing data recently released by the Federal Trade Commission, the fastest-growing type of scam reported to Fraud.org was investment related, particularly those involving cryptocurrencies. Complaints about these scams more than doubled in 2021 (168 percent year-over-year increase).
Top scams reported to Fraud.org in 2021
- Prizes/Sweepstakes/Free Gifts
- Internet: Gen Merchandise
- Fake Check Scams
- Friendship & Sweetheart Swindles
- Investments: Other (incl. cryptocurrency scams)
- Advance Fee Loans, Credit Arrangers
- Family/Friend Imposters
- Computers: Equipment/Software (incl. tech support scams)
“We hear heartbreaking stories from fraud victims nearly every day,” said James Perry, NCL’s consumer services coordinator. “While these statistics are sobering, behind each one of them are real people, some of whom have lost their life savings to criminals promising easy money to their victims.”
The goal of most fraudsters is, ultimately, to get paid. In 2021, consumers most frequently told Fraud.org that fraudsters were after their credit card information. However, complaints noting other payment methods such as gift cards, cryptocurrencies, and peer-to-peer payment apps continued to grow in popularity among scammers. In 2021, complaints involving such payment methods increased by nearly half (45.28 percent) year-over-year.
“We are very concerned that scammers are increasingly adopting new payment methods, many of which offer few—if any—consumer protections,” said Eden Iscil, NCL public policy associate. “This new data should serve as a wake-up call to federal regulators that it is past time to close the loopholes in federal consumer protection law that allows these scams to proliferate.”
About the National Consumers League
The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.