$2.5 billion lost over a decade: Nigerian princes lose their sheen, but scams are on

Last year, Australians reported more than A$634 million lost to fraud, a significant jump from $489.7 million the year before.

The Australian Competition and Consumer Commission (ACCC) has released its latest annual Targeting Scams report.

But despite increased awareness, scam alerts and targeted education campaigns, more Australians are being targeted than ever before.

With all the technological tools we have, why does fraud continue to be so pervasive? And how can the damage be reduced?

Latest key findings

According to the ACCC’s report, “business email compromise” fraud rose to dominance in 2019.

At $132 million, it became the highest category of financial loss reported – the first time this has happened. This usually involves using phishing and hacking to infiltrate company systems and email accounts.

Offenders can intercept payment invoices, or create their own, and funnel victims’ funds into their own accounts. Businesses and individuals make their payments as usual, but unknowingly pay the offender.

Investment and romance schemes also continue to defraud victims. Reports of investment fraud totalled $126 million, up from $80 million in 2018. And romance fraud losses totalled $83 million, up from $60.5 million in 2018.

Overall, men reported higher financial losses ($77.5 million) than women ($63.6 million).

Years of statistics

Reflecting on a decade of the ACCC’s Targeting Scams reports, we can see how fraud has changed with the times.

Since the first report in 2009 (which recorded $69.9 million in losses) Australians have collectively reported more than $2.5 billion in losses.

The number of reports has increased significantly. While this likely reflects a higher percentage of the population being targeted, it also represents more authorities receiving complaints and contributing statistics.

For instance, 2019 marked the first year the big four Australian banks (Westpac, NAB, Commonwealth Bank and ANZ) contributed their data.

The prince of Nigeria needs your help

Today’s offenders have very different approaches to those of ten years ago. There were once many more stories of Nigerian princes (although these still exist).

These days, victims are most often contacted by telephone, although email, text message and social media communications are also common.

Payment methods have advanced, too, with bitcoin and cryptocurrencies becoming popular ways for offenders to receive money.

Why is fraud still so successful?

While technology has long helped scammers, it has also helped improve cyber security options such as antivirus software, and email filters to block spam. So why do we still have fraud?

Essentially, fraud takes a human approach. Criminals seek…