Crime center, FBI report reveals no one is immune to online fraud

InfoWorld |  Security

THE WIDESPREAD ADOPTION of new technologies has created new opportunities for fraud that any Internet user is susceptible to, a situation made worse by ignorance about the issue, according to a new study released this week.

The top complaint reported was online auction fraud, with nearly 66 percent of complaints coming in that category. This was followed by non-delivered merchandise or payment at 22 percent and credit or debit card fraud at nearly 5 percent.

The figures come from the first report on Internet fraud released by the Internet Fraud Complaint Center (IFCC), a partnership between the U.S. Federal Bureau of Investigation (FBI) and the National White Collar Crime Center. The report covers the six-month period from May 8, 2000 to Nov. 8, 2000.

These frauds led to more than $4.6 million in total losses, with the average loss being $894. Despite such a high average amount, only 17 percent of the losses were more than $1,000. The majority of losses totaled less than $500. Investment fraud led to the biggest losses, while auction fraud, despite being the largest culprit percentagewise, led to the lowest average losses.

The perpetrators of the fraud tend to be male, according to the report, and are overwhelmingly U.S. residents (92 percent) living in large states; most (17.3 percent) live in California. The average victim of online fraud also lives in a large and populous state, such as California, Texas, Florida, or New York; is male; and is between the ages of 30 and 50. The report notes, however, that women have also fallen prey to online fraud, and that the ages of victims range from 10 to 100.

More than 50 percent of fraud victims are initially contacted by e-mail, with 38 percent of contacts coming via a Web page, the report said. The leading methods of payment in fraud cases are money order and credit card.

The report includes data taken from more than 20,000 complaints filed on the IFCC Web site. The report is based on the nearly 6,100 complaints referred to law enforcement by Nov. 8, with the majority of the complaints involving the Internet; not all IFCC complaints involve the Internet.

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