AUSTRALIANS lost a record $340 million to scammers last year — but according to a cyber security expert, the problem could actually be far worse than most people realise.
According to the Australian Competition and Consumer Commission’s (ACCC) ninth annual Targeting Scams report released today, more than 200,000 scams were reported to the ACCC, Australian Cybercrime Online Reporting Network (ACORN) and other government agencies in 2017.
A total of $340 million was lost — a $40 million increase compared to 2016.
Investment scams caused the most losses at $64 million — an increase of more than eight per cent — while dating and romance scams caused the second greatest losses at $42 million.
Today marks the beginning of Scams Awareness Week 2018, and ACCC deputy chair Delia Rickard urged the public to take precautions against scammers who pretend to be from well-known government organisations or businesses such as ASIC, the ATO, Centrelink or Telstra.
“It’s very worrying that Australians are losing such extraordinary amounts to scammers. Based on just the reports provided to the ACCC, victims are losing an average of $6500. In some cases people have lost more than $1 million,” she said.
“Some scams are becoming very sophisticated and hard to spot. Scammers use modern technology like social media to contact and deceive their victims. In the past few years, reports indicate scammers are using aggressive techniques both over the phone and online.”
Last year, the ACCC received almost 33,000 reports of threat-based impersonation scams, and Ms Rickard said the public should always stop to check if the call makes sense before handing over money.
“The ATO will never threaten you with immediate arrest; Telstra will never need to access your computer to ‘fix’ a problem; and Centrelink will never require a fee to pay money it owes you. Finally, none of these organisations will ask you to pay using iTunes gift cards,” Ms Rickard said.
“If something doesn’t feel right, hang up the phone or hit delete. If the person said they were, for example, from Telstra or the ATO, find the phone number for that organisation online or in the phone book, call them and let them know about the call you received. They’ll let you know if it’s genuine or a scam.”
But an internet security expert has warned the ACCC’s figures were just “the tip of the iceberg” — and that Australians were actually losing far more to romance and other online scams every year.
Sydney man Ziggy Zapata, who has worked in IT for decades and who is an avid crusader against internet scams, told news.com.au Australians had actually lost more than $1 billion to scammers in 2017.
And he said the problem was only getting worse.
The self-described “geek” said authorities had “no idea of the actual size” of the issue, as the vast majority of victims never came forward.
“The reason is that most people are too embarrassed to go to police and in most cases, there is no redress because the scammers are well out of Australian legal jurisdiction,” Mr Zapata said.
“The other reason is that many scams rely on the suckers getting involved in what appear to be illegal activities. For instance, a scammer might contact a person to stand as next of kin to a deceased person in order to get money from that deceased person’s account.
“Of course, masquerading as a beneficiary falsely is a crime in itself, so if a person is scammed by the old advance fee fraud for getting involved in this, he can’t exactly go to the police and say that he was defrauded because he participated in what was allegedly an illegal act.”
He said romance scams worked by exploiting lonely, vulnerable people while others worked by appealing to people’s greed.
“These people are gullible … and often greed makes them do it. They are a very good target because they have the same sort of mentality as gamblers — they are after a quick buck,” he said.
“But dating scams are pretty sad — they break my heart because they generally target vulnerable men and women who are prime targets to be manipulated.
“The problem is far, far bigger than you could ever imagine — it’s monstrous.”
According to Mr Zapata, the most common scams include:
• Fake US soldier scam — A fraudster will pretend to be a serviceman in need of a small fee to help him move millions — which he’s prepared to share;
• The “washy washy” scam — Scammers claim a vast sum of money — that has somehow been coated in dye — will be shared with you if you pay for the dye removal process;
• Telstra or ASIC scam — Involving an email supposedly from a bank, government agency or official body informing a victim they must pay a fine;
• Inheritance scam — A “lawyer” will inform you of an unknown relative who has passed away, leaving you a fortune;
• Blackmail — A victim will receive an email with vague accusations such as “we know what you did” before demanding payment to keep quiet;
• Lottery scam — A supposed lottery winner contacts victims with the offer of sharing their riches — for a small fee;
• Romance scams — Victims will be targeted on online dating sites or on social media by sophisticated scammers who pretend to be in a relationship with them before asking for money through a series of “hard luck” stories.
Treasurer Scott Morrison said the Australian government had a responsibility to protect all Australians, and vulnerable people in particular, from increasingly “sophisticated” scammers.
“By ensuring the ACCC and ASIC are sufficiently funded, the Turnbull Government is determined to crackdown on these scammers,” he said.
“There are a number of ways people can stay on top of these scams – for starters you can visit the ScamWatch website. You can also jump on the MoneySmart website which includes a list of overseas companies you shouldn’t deal with. Last year ASIC added 45 companies to this list.”