National Consumers League praises FTC’s multilingual fraud reporting announcement

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November 8, 2023

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

The National Consumers League (NCL), America’s oldest consumer advocacy organization today praised the Federal Trade Commission’s (FTC) announcement that consumers can now file fraud and identity complaints in their preferred languages. NCL is the home of the Fraud.org campaign, which is a long-time contributor of complaint data to the FTC’s Consumer Sentinel Network as well as being an ally in the Commission’s efforts to educate consumers about frauds.

The following statement is attributable to NCL Vice President of Public Policy, Telecommunications, and Fraud, John Breyault:

“All consumers are at risk of fraud, regardless of the language they speak. Making it easier for fraud victims to report these crimes in their own language to the FTC is a critically important step in the fight against scams. We are thrilled with today’s announcement and look forward to continuing to work with the Commission and our allies in the anti-fraud community to protect consumers from criminal scammers.”

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About the National Consumers League (NCL)

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 nclnet.org.

Top Ten Scams Report: Consumers reported massive uptick in crypto-linked fraud losses in 2022

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February 6, 2023

Media contact: National Consumers League – Katie Brown, katie@nclnet.org, 202-823-8442

WASHINGTON, D.C. — Reports of scams tied to cryptocurrencies drove a significant increase in median losses in 2022, according to the National Consumers League’s annual Top Ten Scams report. The report, published annually, analyzed more than 3,500 consumer fraud complaints filed with NCL’s Fraud.org campaign last year. 

The report found that the median loss for investment frauds reported to Fraud.org was $18,700, compared to $1,750 in 2021. The complaints in this category frequently described schemes where victims were encouraged to put money into cryptocurrencies and cryptocurrency-linked investments that later turned out to be fraudulent. Such scams drove an increase in the median loss for all frauds reported to Fraud.org to $950, an eleven-year high. 

“Both median losses and the share of incidents reporting losses are up,” said John Breyault, NCL vice president of public policy, telecommunications, and fraud and the director of the Fraud.org campaign. “New technologies seem to be driving these trends, from crypto-related schemes to scammers using new technology to move victims’ money around.” 

Bank account debit, which includes peer-to-peer platforms like Zelle and Venmo, was the second most frequently mentioned way that victims reported sending money to fraudsters in 2022 (27.17% of complaints that included a loss). Compare this to 2021 when bank account debit was mentioned in 11.2% of complaints that included a loss. 

The top ten scam categories reported to Fraud.org in 2022 were: 

  1. Prizes/Sweepstakes/Free Gifts 
  2. Internet: General Merchandise 
  3. Phishing/Spoofing 
  4. Fake Check Scams 
  5. Investments: Other (incl. cryptocurrency) 
  6. Advance Fee Loans, Credit Arrangers 
  7. Friendship & Sweetheart Swindles 
  8. Family/ Friend Imposter 
  9. Computers: Equipment/Software 
  10. Scholarships/Grants 

“While we’re collecting data to better inform our efforts to combat fraud, we’re also aiding victims and connecting them with resources,” said NCL Consumer Services Coordinator James Perry. “It’s important to remember the person behind each report.” 

Notably, the share of reports involving romance scams declined by 31%. This trend may be attributable to last year’s significant media coverage of this type of fraud following the success of fraud-focused shows like “The Tinder Swindler” and “Inventing Anna.”  

“In real time, we are seeing the benefits of a national discussion around these types of fraud” said NCL Public Policy Manager Eden Iscil. “Having an open conversation about something as sensitive as romance scams helps to destigmatize the issue, provide space for victims to seek help, and put pressure on digital platforms to prevent misconduct.” 

To view the full 2023 Top Ten Scams report, click here. 

Methodology 

The National Consumers League Top Ten Scams report analyzed 3,503 complaints submitted by consumers to NCL’s Fraud.org campaign in 2022. This data is self-reported by victims and should not be considered a nationally representative sample. NCL shares complaint data with a network of law enforcement and consumer protection agency partners who combine it with other data sets to identify trends in fraud and build cases. 

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About the National Consumers League (NCL)
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 https://nclnet.org.

NCL urges FTC to prohibit user review manipulation

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January 10, 2023

Media contact: National Consumers League – Katie Brown, katie@nclnet.org, 202-823-8442

WASHINGTON DC. – The National Consumers League (NCL) this week filed comments in support of a Federal Trade Commission (FTC) regulation to ensure the reliability of user reviews. In its comments, NCL urged the FTC to prohibit user reviews from individuals who did not purchase a product or service (or are misrepresenting their experiences with a product or service) and to prohibit sellers from manipulating consumer reviews. In addition, the League advocated for the Commission to require hosts of user reviews to implement measures to protect review integrity, such as requiring purchase verification.  

“Consumers frequently cite user reviews as a key factor when deciding what to buy,” said John Breyault, NCL Vice President of Public Policy, Telecommunications and Fraud. “As a result, fake endorsements steer billions of dollars each year towards certain products and away from competitors. The impacts range from buyers receiving goods of poorer quality than expected to serious safety risks.” 

NCL also encouraged the FTC to prohibit the commercial exploitation of social media engagement metrics, such as buying and selling likes, comments, or shares. Such practices can be used to boost fraudulent product reviews and endorsements, allowing bad actors to manipulate social media platforms to broaden their reach. 

“Right now, it is extremely easy to spend a few dollars and receive hundreds of likes, followers, or other signals that a product or service is of high quality,” said Eden Iscil, NCL Public Policy Manager. “By jumpstarting a post with purchased engagement, the content has a greater chance of reaching a real audience—and being believed by them. Such practices not only affect consumers making purchasing decisions but can also be used to spread other types of misinformation.” 

The FTC initiated this regulatory process following NCL’s request for greater federal enforcement against organized user review fraud, which can be found here.  

NCL’s full comments to the FTC can be found here. 

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About the National Consumers League (NCL)
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 https://nclnet.org.

National Consumers League names Robin Strongin to lead Health Policy

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December 14, 2022

Media contact: National Consumers League – Katie Brown, katie@nclnet.org, 202-823-8442

WASHINGTON DC. –  National Consumers League (NCL)-the nation’s oldest consumer advocacy organization, has named Robin Strongin Senior Director, Health Policy, beginning January 4, 2023.  Robin will oversee NCL’s robust health care portfolio.

An accomplished public affairs expert with decades of experience working in Washington, D.C., Robin has worked with and for federal and state governments, regulatory agencies, the White House, Congress, think tanks, nonprofit organizations, corporations, start-ups, coalitions, and trade associations. Robin served as a Presidential Management Intern and worked in the Office of Legislation and Policy in the Health Care Financing Administration (now the Centers for Medicare and Medicaid Services), the Prospective Payment Assessment Commission (now the Medicare Payment Advisory Commission) in addition to serving in the Office of Congressman James J. Florio (D-NJ).  Robin spent a decade as a senior research associate at George Washington University’s National Health Policy Forum.

Robin ran Amplify Public Affairs, LLC and launched an award-winning Disruptive Women in Health Care blog®; she also served on the following boards: the Institute for Music and Neurologic Function (founded by Dr. Oliver Sacks); AcademyHealth’s Translation and Dissemination Institute Advisory Committee; Kaiser Permanente’s Institute for Health Policy; Older Women’s League; Physician-Parent Caregivers; and The Hill newspaper Publisher’s Advisory Board. In October 2015, Robin was named to the National Alzheimer’s Scientific, Patient and Caregiver Advisory Council of the PCORI-funded Alzheimer’s & Dementia Patient/Caregiver-Powered Research Network (AD-PCPRN); and named a Woman of Impact (https://www.womenofimpact.org) in December 2015.

“The National Consumers League is a powerful force in leading and advocating for consumers’ health and safety,” said Strongin. “I’m deeply honored to be part of a team dedicated to this critical mission and I look forward to working with Sally Greenberg, the board, and the entire team to achieve our vision.”

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About the National Consumers League (NCL)
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 https://nclnet.org.

National Consumers League adds Identity Theft Resource Center ‘Live-Chat’ to Fraud.org to help identity crime victims

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December 13, 2022

Media contact: National Consumers League – Katie Brown, katie@nclnet.org, 202-823-8442

WASHINGTON, D.C. – Today, the National Consumers League (NCL), the nation’s oldest consumer advocacy organization, and the Identity Theft Resource Center® (ITRC), a nationally recognized nonprofit organization established to support victims of identity crime, are partnering up to help victims of identity crimes.

NCL integrated the ITRC’s live-chat function into fraud.org, a project of the NCL to give consumers the information they need to avoid becoming victims of telemarketing and internet fraud. The ITRC live-chat function on fraud.org will help assist victims of identity crimes related to data breaches, identity theft and identity fraud. It will also provide people with another resource during the holiday shopping season when there is an increased risk of identity crimes. According to Forbes, Adobe predicts a 2.5 percent growth in online sales from November 1-December 31, when identity criminals may look to take advantage of increased online activity.

The ITRC’s staff of identity advisors provides preventative information and customized plans to address all types of identity concerns. ITRC advisors assist victims live during business hours or through direct follow-up when contacted after hours and on weekends.

“NCL is always looking for new ways to reach consumers and better protect them from fraud,” said John Breyault, Vice President of Public Policy, Telecommunications, and Fraud at NCL. “By increasing the number of options that individuals can use to contact us, we can help a greater number of people. Thanks to ITRC, consumers with differing accessibility needs, levels of phone service, and communication preferences will find it easier to get in touch with a fraud expert.”

“The NCL and ITRC have a long history of mutual respect and shared commitment to victims of identity crimes,” said Eva Velasquez, President and CEO of the Identity Theft Resource Center. “Adding the NCL to the group of organizations and government agencies using live-chat to help victims continues our fight for small businesses and consumers to protect them from identity criminals. We believe giving more people direct access to our live identity experts – at no cost – will help prevent identity fraud and provide the support needed to recover from these crimes.”

NCL is the third organization the ITRC has partnered with to integrate the ITRC live-chat function on its website. Earlier in 2022, the ITRC embedded its chat into the San Diego District Attorney Office and New Mexico Office of the Attorney General websites.

Since the ITRC’s chat function was launched on fraud.org, three (3) percent of the ITRC’s total cases have come from its website. Implementing the ITRC’s live-chat function provides victims access to support when it is convenient and in a manner people often prefer – a live-chat rather than a phone call. ITRC advisors will:

  • Ask what happened
  • Ask a series of questions to help determine the scope of the problem
  • Provide a victim or curious consumer with a detailed, custom plan of action steps to take

Currently, most ITRC cases from fraud.org involve scams, primarily lottery and prize scams (mostly about criminals pretending to be Publisher’s Clearing House representatives) and existing account takeover of a bank or credit card account.

The ITRC is committed to providing access to everyone seeking help. Read about the Center’s accessibility initiative here. Anyone can contact an advisor by visiting www.idtheftcenter.org or calling toll-free at 888.400.5530.

About the National Consumers League (NCL)

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 https://nclnet.org.

About the Identity Theft Resource Center  

Founded in 1999, the Identity Theft Resource Center® (ITRC) is a national nonprofit organization established to empower and guide consumers, victims, business and government to minimize risk and mitigate the impact of identity compromise and crime. Through public and private support, the ITRC provides no-cost victim assistance and consumer education through its website live-chat idtheftcenter.org  and toll-free phone number 888.400.5530. The ITRC also equips consumers and businesses with information about recent data breaches through its data breach tracking tool, notified. The ITRC offers help to specific populations, including the deaf/hard of hearing and blind/low vision communities.

Unpacking the broadcast TV repack

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If you live in one of the 16 million U.S. households that receives television channels via free, over-the-air (OTA) broadcasting, chances are good that you have seen or will soon see a message pop up at the bottom of your TV screen.

These messages may say things like “the channel is moving frequencies,” “rescan your TV,” or “weak or no signal.” Don’t fret that you’ll lose access to your favorite channels, however. Those messages are just your local TV station letting you know that the station has, or will soon, change frequencies.

Why is this happening? Several years ago, the Federal Communications Commission (FCC), cell phone providers, and TV broadcasters agreed to reallocate parts of the nation’s spectrum that currently carry broadcast television to instead be used for wireless broadband services. This meant that broadcasters must move their stations to different parts of the spectrum to avoid interference with the wireless broadband signals.

For consumers, this means that over the next few years, you will need to re-scan the channels on your TV to continue receiving your broadcast channels. Depending on where you live, you may even have to re-scan on more than one occasion. Don’t worry—the channel numbers you’re used to won’t change. Any preparation that must go into tuning your TV to the new spectrum should be done automatically by your TV during the re-scan process.

Fortunately, the FCC and the broadcasters are going all out to make sure that consumers are not caught unaware by this process (known in industry jargon as the broadcast “repack”). The fastest way to get up to speed is to check out the FCC’s new video explaining the process and what buttons to press on your remote control to re-scan for new channels. The FCC also has a very useful website with FAQs and links to additional resources that can help answer TV owners’ questions. The National Association of Broadcasters also has a great resource with step-by-step instructions on how to re-scan at TVAnswers.org.

Unfortunately, we anticipate that scammers may try to latch on to the repack process. Back in 2008, fraudsters had a field day with the digital television (DTV) transition process, peddling worthless “coupons” and other scams to take advantage of consumer confusion over changes to their TV service. As the repack process gets underway fraudsters, we anticipate that scammers will be looking for ways to take advantage. For example, fraudsters have recently been advertising “miracle” TV antennas claiming they can do things they actually can’t, like getting cable TV broadcasts. As the TV repack gets more media coverage, it’s likely that more potentially misleading or fraudulent ads like these will start showing up in people’s email inboxes, in mailers, and on the radio or in newspapers. If you come across one of these scams, be sure to report it to NCL’s Fraud.org campaign via our secure online complaint form.

For the vast majority of OTA TV watchers, the transition is likely to happen without much friction. Nonetheless, getting familiar with the FCC’s resources keeping an eye out for the scams could help avoid an expensive headache. Until then, happy re-scanning!

Love hurts: New fraud report shows concerning increase in romance scams

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February 1, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—With Valentine’s Day a few short weeks away, those who are looking for love online should also be on the lookout for imposters who want something besides affection: your money. According to the National Consumers League, which is issuing its annual Top Ten Scams report today, so-called “romance scam” complaints showed a big spike in 2018. Whereas such scams made up only 1.54 percent of complaints to NCL in 2017, in 2018 they made up 2.81 percent of complaints, a greater than 45 percent jump, year-over-year. For those who fall prey to these scams, the consequences can be devastating. The average loss reported by victims of these scams in 2018 was $18,831, by far the most financially devastating of the scams reported to NCL.

“Scammers will stop at nothing to separate victims from their money,” said John Breyault, NCL’s vice president of public policy, telecommunications and fraud. “They depend on the people they prey on to act on emotions, not reason. There’s no stronger emotion than love, and scammers are all too eager to use supposedly romantic connections to defraud their victims.”

The annual report, which is compiled from more than 5,300 complaints filed by consumers at NCL’s Fraud.org website, identified another additional worrying trend: for the third year in a row, complaints about phishing and spoofing scams rose. NCL attributes this trend to fraudsters being able to identify and target their victims better with email and robocalls.

“With data breaches putting more financial information in the hands of criminals than ever before, it’s unsurprising that the scammers are sending more convincing-looking phishing and spoofing emails,” said Breyault. “In fact, our own staff at NCL were nearly taken in by one of these scams recently. It just goes to show you that no one is immune to these scams.”

The overall top complaints in 2018 remained unchanged from 2017, with bogus Internet merchandise scams, fraudulent prizes and sweepstakes, and fake check scams making up the three most common types of complaints received at NCL. Other top scam categories included refund/recovery scams, scholarship and grant scams, and imposter scams.

An additional trend that advocates like Breyault are concerned about: the growing use of gift cards as a preferred method of payment by scammers. Although wire transfer and credit cards continue to be the most popular ways for scammers to get paid by their victims, 2018 saw a 25 percent increase in the use of alternative methods, including gift cards, as a payment method.

Read the full 2018 Top Scams report from NCL.

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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.

Federal government shutdown a boon to scammers

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With the partial government shutdown about to enter Day 27, there is no shortage of stories about the shutdown’s impact on everyday citizens. With the shutdown hurting millions of Americans and costing the economy billions of dollars, one group is undoubtedly rooting for the shutdown to go on as long as possible: scammers.

That is because one of the agencies currently shut down is the Federal Trade Commission (FTC), which is one of the government’s biggest cops on the beat against scam artists. In 2017, almost a quarter million consumers reported to the FTC that they lost nearly $1 billion to scammers. While those are certainly big numbers, we know that fraud is a historically underreported crime, so those losses are likely only the tip of the iceberg. 

Screenshot of the FTC's website with and alert showing that it is shutdown.

The FTC relies greatly on consumer complaints to drive its investigations. In 2017, the Commission collected 2.7 million such complaints, giving it the evidence it needed to take down scams of all kinds, from phony debt collectors, to identity thieves, to imposter scams to dozens of other types of cons. Unfortunately, for the past 27 days, the agency has been unable to accept complaints from consumers. That means that for the past 3+ weeks, scammers have been free to defraud Americans without having to worry about getting caught by the FTC. 

Consumers can file their complaints with other organizations, though none of them have the resources or investigative reach of the FTC. For example, state attorneys general typically take fraud complaints, but their investigative reach is often constrained by limited resources and they may lack expertise on the types of fraud that the FTC has investigated for decades. There are also a number of great nonprofit organizations, including the Identity Theft Resource Center, AARP’s Fraud Watch, and NCL’s own Fraud.org that collect complaints and provide counseling to fraud victims. For Fraud.org’s reports, we also typically amplify our impact by sharing our complaints with the FTC, which can and does investigate. With the FTC shut down, that information isn’t currently happening. 

With the FTC absent, scam artists’ jobs are made much easier. The plight of hundreds of thousands of furloughed federal workers – many living paycheck–to–paycheck – is rightfully getting plenty of attention. However, Congress, the White House, and the media should not ignore the millions of consumers who are being put at greater risk of fraud while the government remains shuttered. 

Fraud on Venmo threatens consumer trust in the emerging P2P payments space – National Consumers League

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Fraud in the peer-to-peer (P2P) money transfer space is an all-too-common occurrence and is growing by leaps and bounds. One of the biggest players in the P2P space is Venmo, which is owned by PayPal. Last quarter, the company reported $17 billion in transactions on Venmo, an increase of 78 percent over the same period last year.Unfortunately, wherever money is exchanged, fraudsters will try to find ways to lure consumers into faux deals and fake transactions, particularly when new and potentially unfamiliar technologies are used to make payments. At NCL’s Fraud.org, we hear from thousands of consumers who have either fallen victim to fraud or want advice about avoiding it.

Venmo is no exception to this rule. PayPal reported a spike in fraud on Venmo earlier this year, leading to wider-than-expected operating losses. As TheStreet.com reported this week, many PayPal investors are bullish on Venmo’s potential for monetization but were taken aback by reports that Venmo’s “transaction loss rate”, an internal metric that includes fraud-related losses, rose from 0.25 percent to 0.40 percent of overall Venmo volume between January and March. This was one of the factors that played a part in Venmo’s operating loss of $40 million during the first quarter, according to The Wall Street Journal. Why the spike in early 2018? That is hard to know.

To their credit, as loss patterns emerged, the Venmo team quickly “updated the new features to prevent losses and protect customers,” said Amanda Miller, a PayPal spokesperson. “With the new instant transfer feature, that meant suspending the new feature for a few days and then reintroducing it. Suspending that feature temporarily was the right thing to protect customers.” Venmo also raised fees from a small flat fee to a percentage-based fee.

We hope these changes will help but what have consumers lost in the process?  Scammers have been long abusing P2P services, including Venmo, with scams ranging from reversing payments for goods purchased to using stolen credit cards or hacked accounts to make Venmo transactions. 

But is that enough? And will consumers be left holding the bag when they get caught in fraudulent payment schemes? That’s a question that PayPal and Venmo must answer. It is widely expected that P2P payment systems like Venmo will continue to grow exponentially in the coming years. To maintain consumer trust, they must do all they can to protect consumers from the inevitable scams and frauds that will continue to pop up and harm consumers. If P2P companies like Venmo can’t get fraud under control on their own, it may soon be time for Congress to step in a consider requiring zero-liability regulations such as those that protect users of debit or credit cards.

Rosé explosion leading to fraud in wine industry – National Consumers League

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Haley SwartzRosé – the pink wine that incorporates the skin of red grapes and the flavors of all other varieties – has exploded in popularity over the last five years. Rosé consumption is particularly skewed among millennials and during the summer months, aided by gender-inclusive hashtags, the development of new, millennial-targeted brands, and the particularly “Insta” quality of a pink wine. Consumption of rosé has now eclipsed white wine in France, and in the United States, data indicates Washington, DC is the “capital of rosé,” – illustrating its ubiquity across political and social cultures.Rosé has contributed to an overall growth in wine sales, as consumers increasingly buy rosé in addition to other white and red wines – and higher-priced rosés are bringing in greater profits than cheaper, generic offerings. Experts say rosé consumption differs from other millennial-led fad wine crazes – à la prosecco and Moscato of the late 2010’s – because it is simply a higher quality product.

However, a recent case of fraud in the rosé industry illustrates the safety and quality vulnerabilities faced by consumers throughout global beverage supply chains. Rosé is like champagne, whereby only grapes harvested in the Champagne region of France can be labeled as “real” Champagne. While other European producers have entered into the rosé market, the “best and truest” rosés are made with grapes grown in the Provence region of France. Such a limited geographical area for a “true” rosé supply, combined with soaring global demand, is the perfect recipe for fraud.

Over the past two years, wine merchants have unknowingly sold 10 million bottles of what they thought was pure French rosé – but was just a cheap Spanish red/white blend. Most of the mislabeled wine was sold in French establishments, but some was found in British retail – leading to the question of whether the mislabeled wine may have even entered U.S. markets. The mislabeling included either a “Vin de France” generic label or the more prestigious “IGP” label that refers to a protected geographic designation in French growing regions. Worse, other bottles – though labeled in small print as “Spanish” or “European” in origin – had French scenery on the bottle’s label, including the fleur-de-lis (the former royal arms of France). Such a blatant form of misrepresentation is all too common in the wine industry.

Further, most bottles were placed in the French rosé section of wine retail locations – and, of course, priced accordingly. The Spanish wine, which sold in bulk at only 34 euro cents a liter ($0.40 USD) must be compared to the 75-90 euro cent ($0.88-1.05 USD) price tag for a true French rosé – providing double the profit for the fraudulent producers.

French authorities have identified four wine producers at fault, but only one has been charged with commercial fraud. If found guilty, the producer could face up to two years in prison and a fine of 300,00 Euros. While it’s unlikely the fraudulent bottles are still in a store near you, consumers should learn one lesson from this whole episode: Read the label – all of it – and avoid being distracted by a pretty shade of pink.