About 24,000 Americans lost a reported $1 billion to romance scammers during 2021, the FBI estimated Thursday, marking what the Federal Trade Commission said was the most lucrative year for romance scammers on record—with many scam artists luring their victims into sending cryptocurrency.
The FTC—which only counts scams reported to its Consumer Sentinel Network, a database for scams and crimes like identity theft—said Thursday losses from romance scams rose to $547 million in 2021, up from $307 million in 2020 and $202 million in 2019.
About 25% of losses from scams reported to the FTC last year were paid in cryptocurrency, with the median individual cryptocurrency loss at $9,770, and the agency said a growing number of scammers have tricked victims with fake cryptocurrency investment advice.
Though reports of romance scams increased for every age group, the increase was greatest for people ages 18 to 29, though people in that group reported a median loss of only $750, compared to $9,000 among people age 70 and up, the group for whom losses were greatest.
Though the number of cryptocurrency-related scams grew almost fivefold from 2020 to 2021, gift or reload cards were the most frequent method of payment, used in about 28% of last year’s scams, compared to cryptocurrency at 18%, payment apps or services at 14%, bank transfers or payments at 13% and wire transfers at 12%, according to the FTC.
Many people targeted by romance scammers are initially contacted on dating apps, but more than a third of last year’s victims told the FTC they were first contacted on Facebook or Instagram.
The precipitous increase in online romance scams has coincided with a pandemic-driven increase in social isolation and a reliance on technology to meet social needs. Tinder users sent 19% more messages per day in February 2021 compared to February 2020, and conversation length grew 32% over pre-pandemic levels, the company said.
Romance scammers create fake online profiles using photos swiped from the web, often creating identities with built-in excuses for not being available to meet in person, such as serving in the military overseas. Once a scammer has gained the trust of their victim, they may request money to help resolve a supposed crisis, such as paying for medical treatment for a sick child or resolving “processing fees” to release funds that would otherwise be in jeopardy.
To guard against these scams, the FBI said anyone looking to start a romantic relationship online should “go slowly and ask lots of questions,” consider researching the other person’s photos to see if they have been used elsewhere and avoid sending money, cryptocurrency or gift cards before meeting in-person.“We need to be wary about casting certain groups as the ‘natural’ victims of scams,” Sarah Rutherford, senior director of portfolio marketing, global, fraud and compliance at analytics firm FICO, told Forbes.
“The idea of the lonely, old woman struggling to use a computer to connect with the world can make others feel it would never happen to them and lower their defenses.”
In 2012, pioneering particle physicist Paul Frampton was arrested in Buenos Aires after checking a suitcase with 2 kilograms of cocaine concealed in the lining. Frampton, who was convicted of drug smuggling in Argentina and sentenced to four years and eight months in prison, said he was lured into becoming a drug mule by a romance scammer posing as a professional swimwear model.
Though the FBI on Thursday published an approximate figure of $1 billion in reported losses to romance scammers in 2021, a precise figure will not be available until the Internet Crime Complaint Center’s annual report is finalized. Additionally, many victims of romance scams likely did not report their losses, the FBI said.
I cover breaking news for Forbes. Previously, I was editor for The Cordova Times newspaper in Cordova, Alaska. In 2018, I obtained a Master of Journalism degree at the University of Melbourne. From 2015-2017, I headed Chess For The Gambia, a youth development project.
Internet fraud is a type of cybercrime fraud or deception which makes use of the Internet and could involve hiding of information or providing incorrect information for the purpose of tricking victims out of money, property, and inheritance. Internet fraud is not considered a single, distinctive crime but covers a range of illegal and illicit actions that are committed in cyberspace.
It is, however, differentiated from theft since, in this case, the victim voluntarily and knowingly provides the information, money or property to the perpetrator. It is also distinguished by the way it involves temporally and spatially separated offenders.
According to the FBI‘s 2017 Internet Crime Report, the Internet Crime Complaint Center (IC3) received about 300,000 complaints. Victims lost over $1.4 billion in online fraud in 2017. According to a study conducted by the Center for Strategic and International Studies (CSIS) and McAfee, cybercrime costs the global economy as much as $600 billion, which translates into 0.8% of total global GDP.
Online fraud appears in many forms. It ranges from email spam to online scams. Internet fraud can occur even if partly based on the use of Internet services and is mostly or completely based on the use of the Internet.
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