Australian scam victims losing $19,654 on average
The amount of money Australians lost to scammers surged by 80% between 2021 and 2022 to a record $3.1 billion, a new report produced by the Australian Competition and Consumer Commission (ACCC) has revealed.
The Targeting Scams report, which compiled data from a number of bodies including the Australian Financial Crimes Exchange, IDCARE, ReportCyber and Scamwatch, shows that Australians reported over 500,000 scams during 2022 - 239,237 of which were made to the ACCC's dedicated scam prevention hub Scamwatch.
Unfortunately, Scamwatch received 28,980 reports of financial loss during the year, with the average amount lost rising from $12,742 in 2021 to $19,654 in 2022.
"Australians lost more money to scams than ever before in 2022, but the true cost of scams is much more than a dollar figure as they also cause emotional distress to victims, their families and businesses," says the ACCC's Deputy Chair, Catriona Lowe.
With the amount of money lost to scams continuing to rise, Lowe says that there needs to be more collaboration between government, the private sector and law enforcement.
"Unfortunately, there are still significant gaps between and within the key sectors - banks, telcos and digital platforms; and between regulators that scammers exploit to steal money from customers. So we would like to see initiatives that apply across the sectors, knowing that scammers will target the weakest link."
The ACCC is also calling for action in three key areas to address the issue.
"First, we need to stop scammers reaching consumers by disrupting phone calls, SMS, email, social media messaging or other ways in which scammers contact would-be victims," says Lowe.
"Second, we need to make sure consumers are supported with up-to-date information so they have the best chance of spotting a scammer when contacted. Finally, we need effective measures in place to prevent funds being transferred to scammers."
Aussies taken in by dodgy investments
By far the costliest type of scam recorded during 2022 were investment scams, with a total of $1.5 billion lost throughout the year. For context, they made up two thirds of all financial losses reported by victims to Scamwatch.
According to the report, investment scammers often target people over social media - either by reaching out directly, or via fake advertisements.
The scam itself is then likely to play out over a period of months before it ends with the scammer convincing the victim to make a transfer of cryptocurrency, or cash through a bank transfer.
In one case outlined in the report, a victim lost $50,000 to a fraudulent bond scheme when they were convinced by a scammer, pretending to be a financial planner, to purchase a number of treasury bonds. Despite researching the firm itself and confirming that it, as well as the bank account provided, were both genuine, the supposed financial planner was not, so the victim lost their money.
Professor Asha Rao, Associate Dean of Mathematical Sciences at RMIT University, says that while it's not necessarily surprising that people get caught up in what can often seem like legitimate investment opportunities, it's important to remember that if it sounds too good to be true, it probably is.
"We all have to realise that there's no such thing as a free lunch and that there really is no way we are going to get free money."
Aside from fake investment schemes, Australians also lost $229 million to remote access scams (where scammers gain access to someone's computer or device), $225 million to payment redirection scams and $210 million to romance scams.
Fending off scams
So with scammers seemingly targeting Australians like never before, is there anything individuals can do to prevent themselves becoming a victim? To start, the ACCC encourages people to adopt three simple behavioural changes to better safeguard themselves:
Stop: If you're being asked to provide personal details or even money to an individual or business you can't verify, the ACCC urges Australians to simply stop before hitting send.
Think: Related to that, the ACCC encourages people to think critically about any unsolicited contact they receive. Even if you think it may be real, it's better not to reply at all, but instead, to contact the business or government department directly through an official channel.
Protect: If you're suspicious or think you've been the victim of a scam, the ACCC recommends acting as quickly as possible. For example, if you notice unusual activity in your bank account, contact your bank directly as soon as you can.
Professor Rao's advice is similar. In addition to taking the time to consider any interaction or potential exchange of information or money, she also recommends that people approach any contact with unknown parties with a healthy dose of skepticism.
"I would just say pause. Before you click, before you pick up the phone, before you do anything, just pause and ask yourself if this is too good to be true, or if you were even expecting this call, or email or message."
"We've all been conditioned to pick up the phone immediately and that is being used against us. This is basically how social engineering works - it works on our weak points. So we need to be skeptical and not be afraid, because this is what scammers exploit the most: our desire to make money and our fear."
And for those who do manage to catch a scammer in the act, Professor Rao suggests that it's better to simply hang up the phone or delete the message rather than toying with them.
"Often people think it's a great idea to engage with scammers and send them on a merry ride. While this will give immediate pleasure, it does expose more of your information to them - you will inadvertently give away information that the scammers can use to better tailor the attack. Best to tag the number or email as spam and block them."
For more safeguarding tips and red flags to watch out for you can read through our article on how to protect yourself from scams, or head over to the ACCC's Scamwatch for even more helpful guides and information on scams.
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