We’re living in the golden age of fraud. Whether it’s computer, text or robocall scams — targeting the elderly and the young alike — there are ever more avenues to try to part you from your money or identity. While law enforcement and consumer protection advocates have been busier than ever, today’s Daily Dose gives you the lowdown on what’s happening and how to protect yourself.
Dine-and-Dash. It’s a hard meal to swallow. The restaurant business suffered a catastrophic blow during the pandemic and economic downturn. But that’s not the only reason a growing number of Los Angeles restaurants are closing down. In a new form of dine-and-dash tailored to the era of delivery apps and curbside pickups, restaurants are seeing a spike in the use of fraudulent credit cards or customers requesting refunds by falsely claiming they never received part or all of an order. And when charges are disputed with big food delivery companies and credit cards — with apps like Grubhub having a no-questions-asked return policy — small restaurants are often left holding the bill. Credit card fraud, which has soared during the pandemic, hit $11 billion last year in the U.S., according to one estimate.
Frankenstein Frauds. Identity fraud, wherein scammers use a mix of real and fake information to create a whole new identity, has become rampant across the United States. But Experian’s Future of Fraud Forecast details how fraudsters will soon be even more successful. How? Using artificial intelligence, which enables more sophisticated impersonation with fake faces created from several different people’s features that can fool biometric verification systems. What are now being called “Frankenstein IDs” may well become the future of identity scams.
Crypto-Con Capital. It’s a tag that might not appear to fit Uganda, one of the world’s poorest countries. But the East African nation has emerged as an unlikely hub for large cryptocurrency scams, with crooks preying on the country’s weak governance and low financial literacy. From 2018 to 2020, more than 200,000 Ugandans lost about $1 billion, or almost 4 percent of the country’s $28 billion GDP. Victims range from students and churchgoers to army officers and government officials. But that’s only half the story. Critics point out that President Yoweri Museveni has refused to crack down on dubious crypto firms. Is it a coincidence that the son of Museveni’s prime minister runs CryptoSavannah? Read more on OZY.
The Next El Chapos. As U.S. President Joe Biden grapples with a fresh migrant crisis, his next border challenge is already simmering. It’s one that could render any wall or physical barrier irrelevant. A growing band of Mexican and Brazilian hackers is cooking up and selling code specifically targeting Latin American and U.S. banks and ATMs. And experts fear the region’s big criminal gangs that previously smuggled drugs and people across the border might embrace these hackers to loot millions digitally, instead of risking truck hijackings or assassinations. Read more on OZY.
Unsuspecting Money Mules. You’ve lost your job. If you’re not careful, you could lose your freedom next. Amid mass unemployment and financial insecurity, more and more young people in Britain are falling prey to scams that involve funneling illegitimate money from one bank to another through their accounts. According to fraud prevention company Cifas, there were more than 17,000 suspected cases of money muling involving 21- to 30-year-olds in the U.K. last year. It usually starts with a job posting on social media, offering targets a cut of the action — but it’s also their heads on the chopping block when law enforcement sniffs out the money-laundering scam.
iPhone Politics. In February, Indian Twitter was abuzz with a new kind of scam: Users alleged that Squeaks — a social platform created to give voice to the right wing — and its sister venture, Naarad Pay, an online payment company, had scammed customers out of thousands of dollars by offering cheap iPhones to use while posting right-wing propaganda. And yet, not all who participated were “scammed.” What was the modus operandi? If 100 people opted for the scheme, maybe only 20-30 — those more likely to be influencers — would get their deliveries. The rest would get duped. And while Twitter suspended the accounts of the mastermind and owner of both companies, the right wingers are still fighting among themselves for the coveted devices.
making the headlines
Vax Attack. They are a highly coveted and scarce resource, so it’s only natural that COVID-19 vaccines have triggered a spike in scams. The FBI and the Better Business Bureau warn that fraudsters will lure you with promises of early access or a personal shipment in the U.S. One tipoff that a scam is brewing: You’re asked to pay for the vaccine. Meanwhile, China has arrested the leader of a multimillion-dollar scam in which syringes filled with saline solution and mineral water were sold and shipped as COVID-19 vaccines.
Scam PACs. A new flood of billions of dollars from small donors into American politics is sparking a proliferation of so-called scam PACs, groups that claim to be helping candidates get elected but often spend most of the money on raising more money and making consultants rich. Some are outright frauds, but many stay within the bounds of legality given loose rules about donor money. Take the Lincoln Project, the high-profile group that made viral videos attacking Donald Trump and raised close to $90 million, much of which was directed, as one of its co-founders reportedly said, to build “generational wealth” … well beyond the goal of getting Trump voted out. Now Trump may be getting in on the act: He raised millions after the election to “stop the steal” and is urging donors to give to his personal PAC rather than the Republican Party. Those funds can be used to pay for just about any expense the former president chooses.
One Ring to Rule Them All. If you start seeing missed calls from foreign numbers, you might be in the crosshairs of a “one ring” or “Wangiri” scam. What do the scammers, mostly calling from Lesotho or Samoa numbers, want? For you to call them back so they can keep you on the line for as long as possible. You’ll then be charged premium rates and won’t even know until your next phone bill arrives. New Zealanders have been seeing a spike of late, with the calls coming from Lesotho, Sudan or Samoa. But the practice originated in Japan — Wangiri is Japanese for “one (ring) and cut” — and has hit the U.S. and elsewhere. It’s just a sliver of the global glut of scam calls: 3 out of 4 Americans were targeted by phone scammers in 2020, and Americans received 4.6 billion robocalls just last month.
Meet the Con Queen. For all its glitz and glamour, Hollywood is a land of gig workers on the lookout for the next opportunity. That invites abuse, and no one was better at it than the so-called Con Queen, who is accused of scamming hundreds of people over the phone. Impersonating top executives, the scammer offered a slew of makeup artists, photographers, trainers, actors and stuntmen what sounded like a golden ticket: a job in Indonesia on a blockbuster movie shoot. After the worker spent their own money to fly there and pay various fees to accomplices on the ground in Jakarta, there would be no job. The good news? Gobind Tahilramani, the man authorities have identified as the mastermind, was arrested in the U.K. in November and awaits extradition to the U.S. on several charges.
Silicone Scamsters. We told you about artificial intelligence-enabled identity scams earlier. But there’s a simpler way to fool people and rake in the moolah. Fraudsters used a silicone mask of veteran French politician Jean-Yves Le Drian, at the time France’s defense minister and now foreign minister, to dupe rich victims into believing they were donating cash for a cause, stealing nearly $60 million in all. Those scammed include luminaries like the Aga Khan. Seven people are on trial for the crime, but are we sure it’s actually them in court?
Call Centers. Home to one of the world’s largest outsourcing industries, India’s call centers employ 1.2 million people and bring in $28 billion in annual revenue. Those people aren’t all helping fix your iPhone. India has emerged as a global fraud hub, where few are prosecuted and theft is commonplace. In fact, a Truecaller poll reveals that 22 percent of Americans have fallen prey to scam calls, losing nearly $20 billion. Who’s on the other end? Young Indians trying to make a living.
what’s old is new again
What the Heart Wants. Your dating life might have suffered during the pandemic because, well, we were explicitly advised not to touch each other, but now’s the time to stay alert for cyber romance scams. Research by security software firm Tessian reveals that 29 percent of people have been victimized by a romance scam, with U.S. respondents four times more likely to be targeted than those in the U.K. As Tim Sadler, CEO of Tessian, puts it, “The rise in online romance scams brings a whole new meaning to catfishing.” So what’s a discerning dater to do? Be skeptical of any direct message, friend request or email from someone you don’t know — and think twice, maybe three times, before sending anyone money.
Insurance Frauds. It’s a crime as old as ancient Rome: getting a big insurance payment through underhanded means. According to the FBI, insurance fraud is a $40 billion per year criminal enterprise — not including health insurance — and costs the average U.S. family between $400 and $700 annually in increased insurance premiums. Industry experts believe the number of fraudulent claims has spiked since the start of the pandemic, as oversight measures like in-person inspection of auto repairs couldn’t take place.
Tax Scams. If it’s really the IRS calling or knocking on your door, you’ll know: They will only be asking you to pay the U.S. Treasury. And yet thousands of people have lost millions of dollars and their personal information to tax scams, wherein crooks use mail, telephone or email to swindle individuals, businesses, and payroll and tax professionals. The truly surprising part? New research by ACI Worldwide and YouGov reveals that millennials are more likely to fall for tax scams than baby boomers.
Visa Scams. It turns out that closed borders fuel more uncertainty for vulnerable immigrants, leaving them exposed to fraud. The Australian Competition and Consumer Commission warns of an increasing number of scams where victims, who usually don’t speak English, are falsely told they’re on the government’s radar for minor irregularities that could get them deported — unless they pay up. In 2020, victims lost more than $9 million to such scams in Australia.
the scam fighters
Save the Athletes. Because they make a lot of money at a young age and often come from modest means, sports stars are easy marks for financial scammers. Legendary running back Adrian Peterson, for example, had heavy debts despite earning more than $100 million during the course of his 14-year NFL career. So he brought in Chase Carlson, the investment fraud attorney whom dozens of pro athletes call when they’ve been had. Carlson found his way into the business after selling a refurbished car to an NFL player. Once he entered those pro athlete social circles, he discovered that many NFL players were getting taken by crooked advisers. Now he helps bust up Ponzi schemes and other scams targeting newly rich pro athletes.
The App That Fights Back. RoboKiller takes a cheeky approach to fighting scammers by helping screen scam calls — and wasting the scammers’ time by engaging them in nonsensical conversations. The app even lets you listen back to these entertaining exchanges. How does it work? First, the spam call is blocked; then, it is answered by AI-powered “answer bots” whose only goal is to be as annoying to the spammer as possible. Read more on OZY.
Speak Now or Forever Hold Your Peace. Since the 2015 launch of the China-Pakistan Economic Corridor, along with trade came the idea of marriages between young Pakistani women and Chinese businessmen. It wasn’t all happily ever after. After spotting cases of human trafficking of Pakistani teens — with the Chinese men paying substantial sums to the girls’ families — Father Morris Jalal, a Capuchin priest in Lahore, started a social media campaign against such phony marriages. In one case, Pakistani authorities charged 21 Chinese men for a scheme involving prostitution and even organ harvesting of Pakistani girls, who were reeled in with fake marriages.