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Australians lost half a billion dollars to scams in 2018
Most of the losses went to investment scams as tricksters found innovative ways to dupe victims into parting with their money
Australians lost nearly half a billion dollars to scammers in 2018, according to the latest figures from the Australian Competition and Consumer Commission (ACCC).
According to ACCC deputy chair Delia Rickard, the combined losses reported to scam reporting website Scamwatch and other government agencies exceeded A$489m, which was A$149m more than in 2017.
“These record losses are likely just the tip of the iceberg,” said Rickard. “We know that not everyone who suffers a loss to a scammer reports it to a government agency.”
Investment scams accounted for losses worth A$86m, an increase of over 34% compared with 2017. Dating and romance scams also represented significant losses, increasing from A$42m in 2017 to A$60.5m in 2018.
“These extraordinary losses show that scammers are causing significant financial and emotional harm to many Australians,” said Rickard.
Scammers are adapting old scams to new technology, seeking payment through unusual methods and automating scam calls to increase their reach to potential victims.
In late 2018, many thousands of Australian households were hit with automated phone calls from scammers impersonating the Australian Taxation Office (ATO) threatening arrest for unpaid taxes.
Pressure and fear tactics
In November, reports of the ATO scam increased more than 900%, indicating the scammers were engaged in a concentrated campaign to scam as many Australians as possible. “Scammers are using pressure and fear tactics combined with technology to trick people into parting with their money,” said Rickard.
“Scammers increasingly ask for money via iTunes cards, Google Play cards and cryptocurrencies to avoid the anti-scam measures employed by banks and money laundering detection systems.”
In 2018, reports to Scamwatch where cryptocurrencies were used to pay scammers numbered 674, with reported losses of A$6.1m. This is a 190% increase over the A$2.1m reported in 2017.
Also, the total reported losses via gift cards exceeded A$4.3m from almost 1,500 reports. Apple iTunes cards accounted for 72% of these losses or A$3.1m, an increase from the A$1.2m reported in 2017
Australian businesses were also targeted by sophisticated business email compromise scams with reports of losses to Scamwatch and other agencies exceeding A$60m last year.
Scammers are hacking businesses’ email systems and impersonating key personnel in emails. They request changes to regular bank account details so that money is transferred to the scammer’s account instead of where it should normally go. Many businesses are caught off guard because the emails appear genuine.
Read more about cyber security in Australia
- The average value of fraudulent credit card transactions is more than double that of valid purchases in ANZ, underscoring the need for consumers in the two countries to remain vigilant about credit card security.
- McAfee executive attributes Australia’s poor cloud security record to the lack of data protection measures amid “new and confusing” cloud configurations.
- With security experts and bankers expecting a 9/11-style cyber event, deeper collaboration between companies and governments is necessary to identify emerging threats before they occur.
- Tech giant Apple argued that the lack of judicial oversight could reduce customer trust and security, among other reservations over Australia’s draft decryption legislation.
Rickard said that while ACCC has been working with banks, financial intermediaries and online classified sites to disrupt scams, it – along with the Australian Communications and Media Authority and the Australian Cyber Security Centre – would also like to see social media platforms and telcos do more to limit the ability of scammers to connect with victims.
That said, the ACCC acknowledged in its report that due to the international nature of scams and the jurisdictional and enforcement challenges in bringing scammers to justice, the main tool to reduce the impact of scams on Australians is education,raising awareness and engagement with the public.
“The ACCC’s main method of achieving this is our online activity through the scamwatch.gov.au website and its resources, such as The little black book of scams, as well as our ongoing engagement with government and private organisations,” it said. “Raising awareness on social media platforms and through interviews with traditional media also helps spread the warnings about new and emerging scams.”