FBI finds scammers impersonating the FBI now one of worst online threats

FBI spam, identity theft, fee fraud and non-delivery of merchandise round out top 5 most complained about online issues

In a weird turn of events the most common Internet crime complaints in 2011 were those involving scams that involved fraudsters pretending to be the FBI according to the yearly online crime report issued through the FBI's partner, the Internet Crime Complaint Center (IC3) and the National White Collar Crime Center (NW3C).

The 2011 IC3 Internet Crime Report issued found that of the 314,246 complaints the IC3 received last year over 14,000 involved scamsters posing as the FBI in one shady online form or another.  The 314,246 complaints represent a 3.4% increase over 2010.

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The IC3 said the top five crimes included:

  • FBI-related Scams - Scams in which a criminal poses as the FBI to defraud victims.
  • Identity Theft- Unauthorized use of a victim's personal identifying information to commit fraud or other crimes.
  • Advance Fee Fraud- Criminals convince victims to pay a fee to receive something of value, but do not deliver anything of value to the victim.
  • Non-Auction/Non-Delivery of Merchandise - Purchaser does not receive items purchased.
  • Overpayment Fraud - An incident in which the complainant receives an invalid monetary instrument with instructions to deposit it in a bank account and send excess funds or a percentage of the deposited money back to the sender.

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As for the use of the FBI name in dirty online deeds, the IC3 said the names of various government agencies and high-ranking government officials have been used in spam attacks in an attempt to defraud consumers. Government agencies do not send unsolicited emails. Complaints related to spam emails purportedly sent from the FBI continued to be reported with high frequency to IC3. In 2011, IC3 received about 39 complaints per day of this type. With an average reported loss of approximately $245 per complaint, victims reported losing more than $9,600 to this scam every day.

The 2011 IC3 Internet Crime Report found that the IC3 received and processed more than 26,000 complaints per month and that the top five worst complaint states were California (34,169), Florida (20,034), Texas (18,477), New York (15,056) and Ohio (12,661). Victims in California reported the highest dollar losses with a total of $70.5 million. For victims reporting financial losses, the average was $4,187, the IC3 stated.

The report also detailed some of the other scams that were "popular" in 2011:

Romance Scams: In 2011, IC3 received over 5,600 complaints of romance scams in which scammers target individuals who search for companionship or romance online. Victims believe they are "dating" someone decent and honest. However, the online contact is often a criminal with a well-rehearsed script that scammers use repeatedly and successfully. Scammers search chat rooms, dating sites, and social networking sites looking for victims. Although the principal group of victims is over 40 years old, divorced or widowed, disabled and often elderly, all demographics are at risk, the IC3 reported.   Scammers use poetry, flowers and other gifts to reel in victims, while declaring "undying love." These criminals also use stories of severe life circumstances, tragedies, family deaths, personal injuries or other hardships to keep their victims concerned and involved in their schemes. They also ask victims to send money to help overcome alleged financial hardships.

These scams not only take a high toll on victims emotionally, but monetarily as well. In 2011, victim reported losses to various romance scams totaled $50.4 million. On average, each victim reported a loss of $8,900. At a rate of 15 complaints received per day, these scams saw daily reported losses of roughly $138,000, or more than $5,700 every hour.

Work-from-Home Scams: Consumers continue to lose money from work-from-home scams that cyber criminals use to move stolen funds. Regrettably, due to their participation, these individuals may face criminal charges. Organized cyber criminals recruit their victims through newspaper ads, online employment services, unsolicited emails or "spam," and social networking sites advertising work-from-home "opportunities."

Participating with a legitimate business, the consumer becomes a "mule" for criminals who use the consumer's or other victim's accounts to steal and launder money. In addition, the scammers may compromise the victim's own identity or accounts. Employment scams reported to IC3 in 2011 showed losses exceeding $20 million. Complaints from victims of these scams averaged two per hour in 2011. With an average reported loss of $1,160 per complaint, victims of employment scams reported losing more than $55,000 per day ($2,297 per hour), according to the IC3 report.

Loan Intimidation Scams: IC3 said it receives a high volume of complaints from victims of payday loan telephone collection scams. In these scams, a caller claims that the victim is delinquent in a payday loan and must repay the loan to avoid legal consequences. The callers purport to be representatives of the FBI, Federal Legislative Department, various law firms or other legitimate-sounding agencies. They claim to be collecting debts for various companies.

One of the most insidious aspects of this scam is that the callers have accurate information about the victims, including Social Security numbers, dates of birth, addresses, employer information, bank account numbers, and names and telephone numbers of relatives and friends. The method by which the fraudsters obtained the personal information is unclear, but victims often relay that they had completed online applications for other loans or credit cards before the calls began.

The fraudsters relentlessly call the victims' homes, cell phones and places of employment. They refuse to provide the victims any details of the alleged payday loans and become abusive when questioned. The callers threaten victims with legal actions, arrests, and in some cases physical violence if they refuse to pay. In many cases, the callers even resort to harassment of the victims' relatives, friends and employers.

In 2011, reported losses for victims of loan intimidation scams exceeded $8 million. At the rate of 27 complaints received per day, these scams resulted in reported losses of $934 per hour, or more than $22,000 per day.

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