The Federal Trade Commission released data showing that consumers lost more than $10 billion to fraud in 2023. This represents a 14% increase from the previous year’s reported losses.
Consumers reported losing $4.6 billion to investment scams in 2023, the highest figure for any category. Individuals reported a median loss of $7,700 to investment-related frauds, an uptick from $5,000 in 2022. Imposter scams followed closely behind, with reported losses nearing $2.7 billion, making it the second-highest category in terms of financial impact.
Scammers continue to use bank transfers to pull off these crimes.Bank transfers and payments accounted for $1.86 billion in losses last year, the highest of any reported method. In second place was cryptocurrency, which accounted for $1.41 billion in reported losses.
Overall, the FTC received fraud reports from 2.6 million consumers last year, with imposter scams topping the list as the most frequently reported scam category. There were increases in reports of fraudsters impersonating both business and government officials. Online shopping issues ranked as the second most commonly reported type of fraud, followed by prizes, sweepstakes, and lotteries.
Another noticeable shift in 2023 was the ascendancy of email as the primary method used by fraudsters to target their victims, displacing text messages from its long-held position. Phone calls, which for decades dominated as the most reported contact method for fraud, trailed behind in second place, with text messages following closely behind.
Strategies for Fighting Fraud
With these facts in mind, the FTC is moving forward with several proposals designed to crack down on fraud. It is once again promoting a trade regulation rule, first suggested in 2022, that would prohibit the impersonation of government, businesses, or their officials. The commission is now soliciting “written comment, data, and arguments concerning the utility and scope of the proposed trade regulation rule to prohibit the impersonation of government, businesses, or their officials.”
The FTC also brought back an initiative from 2023 to help protect consumers from the misuse of artificial intelligence-enabled voice cloning for fraud and other harms. Last summer, it opened an investigation into whether OpenAI’s ChatGPT harmed consumers by putting their personal data at risk. The FTC sent a 20-page letter to OpenAI, asking the organization to address a variety of concerns, including the identification of third parties with access to its Large Language Models via API.
