Online fraud and other computer schemes cost the US $265 million-up from $239 million in 2007 or an average of average individual loss was $931. The FBI said 275,284 complaints were received in 2008 by the Internet Crime Complaint Center (IC3), and the National White Collar Crime Center (NW3C),-up from 206,884 (33%) over 2007.
YEAR COMPLAINTS LOSS
2008 275,284 $265 million
2007 206,884 $239.09 million
2006 207,492 $198.44 million
2005 231,493 $183.12 million
2004 207,449 $68.14 million
The FBI and IC3 said complaints run the gamut from fraud such as auction fraud, non-delivery, and credit/debit card fraud as well as non-fraudulent complaints such as computer intrusions, spam/unsolicited e-mail, and child pornography.
The leading complaints included: Non-delivered merchandise and/or payment was, by far, the most reported offense, comprising 32.9% of referred complaints. Internet auction fraud accounted for 25.5% of referred complaints. Credit/debit card fraud made up 9.0% of referred complaints. Confidence fraud, computer fraud, check fraud, and Nigerian letter fraud round out the top seven categories of complaints referred to law enforcement during the year, according to the report.
Of those complaints reporting a dollar loss, the highest median losses were found among check fraud ($3,000), confidence fraud ($2,000), Nigerian (west African, 419, Advance Fee) letter fraud ($1,650), the IC3 stated.
Among perpetrators, 77.4% were male and half resided in one of the following states: California, New York, Florida, Texas, District of Columbia, and Washington. The majority of reported perpetrators (66.1%) were from the United States; however, a significant number of fraudsters where also located in the United Kingdom , Nigeria , Canada , China, and South Africa, the IC3 stated.
Among complainants, 55.4% were male, nearly half were between the ages of 30 and 50 and one-third resided in one of the four most populated states: California, Florida, Texas, and New York. While most were from the United States (92.4%), IC3 received a number of complaints from Canada, United Kingdom, Australia, India, and France.
Men lost more money than females (ratio of $1.69 dollars lost per male to every $1.00 dollar lost per female). This may be a function of both online purchasing differences by gender and the type of fraudulent schemes by which the individuals were victimized, the FBI said
E-mail (74.0%) and webpages (28.9%) were the two primary places fraud occurred.
The report also notes that all the news isn't bad, in fact the IC3 has helped out with some high-profile computer crime prosecutions too, For example:
John Childe, the subject of multiple complaints filed with IC3, has been sentenced. IC3 complaints alleged that Childe offered various items for sale on the eBay auction site and either failed to deliver the items or sent inferior or less expensive products. The investigator assigned to the case as part of the San Diego CATCH Team, contacted the IC3 for a database search to determine if there were additional victims that had filed. According to the investigator, Childe pled guilty and will make restitution to his victims. Childe was sentenced to three years probation.
Rachel Trent, a Virginia woman who scammed sports memorabilia collectors out of $3,000 has been sentenced to four years in prison. Trent was the subject of multiple complaints filed with IC3, used the eBay auction site to bilk collectors out of their money. She offered baseball and football cards on the site, advertising the items as rare. Once the buyer sent payment for the card, Trent would send the buyer a worthless card or a card that was different than the one shown in the auction; in some cases, Trent would send no card at all. The Central Virginia Computer Crimes Task Force arrested Trent after receiving complaints from victims in Virginia, Ohio and Pennsylvania. Trent pled guilty to the charges in Campbell County Circuit Court.
Kenneth Kranich has been charged with three counts of theft by fraud. A year-long investigation of Kranich's activities was initiated after police received notification of multiple complaints being filed with IC3 involving items that Kranich placed up for bid on the eBay auction site. The complaints allege that Kranich offered numerous Hewlett-Packard computers for sale, receiving between $375 and $465 for each computer. The computers, however, were never sent to their purchasers. Investigators built their case by working with eBay, who provided law enforcement with the registered identity associated with Kranich's eBay user ID. Police are currently filing charges in the four cases that presented the most evidence, however, as many as 42 victims spanning 12 states were possibly involved. Prior to the current charges, Kranich possessed no criminal record; he confessed to investigators that he was using the eBay scheme to fund his gambling addiction.
Justin Castilyn, of Center Township Pennsylvania, has been arrested for allegedly sending a counterfeit money order to a San Francisco man for the purchase of more than 200 video games. The seller, who had listed the games on Craigslist, shipped the games to Castilyn after receiving payment from him in the form of a money order for $1,950.00. Upon attempting to deposit the money, however, the seller learned that the money order was counterfeit and filed a complaint with IC3, the San Francisco Police, and Pennsylvania authorities. During the investigation, the investigator contacted IC3 and learned that federal authorities already suspected Castilyn of scamming at least eight other victims, either through non-delivery of merchandise or nonpayment for merchandise, in online transactions. With this information, a search warrant was obtained and two computers, as well as, twelve other suspected counterfeit money orders were seized from Castilyn's residence. The 28 year old Castilyn was arraigned on charges of forgery, access device fraud, receiving stolen property and unlawful use of a computer and was placed in the county jail on $75,000.00 bond.
Jive Network, Inc., an organization that has been the subject of complaints filed with the (IC3), has been dealt a major blow by the United States Attorney's Office in the Middle District of Florida. US Attorney Robert O'Neill has announced that Jude LaCour, his father Jeffery LaCour, and Hudsen Smith have been indicted along with eight other defendants. According to the indictment, the defendants conspired to distribute controlled substances and other prescription drugs to customers located across the US who did not have valid prescriptions. Jude LaCour owned and operated Jive Network Inc., which used the Internet to distribute and dispense the drugs to customers unlawfully. Jeffery LaCour served as the Director of Operations for the organization and Hudsen Smith was the Director of Pharmacy/ Physician operations. The organization distributed approximately 4.8 million dosage units of Schedule III controlled substances and approximately 39.2 million dosage units of Schedule IV controlled substances. Jude and Jeffrey LaCour allegedly agreed to launder the proceeds of the illegal drug conspiracy with the intent to promote and carry on the conspiracy. In addition, they transferred millions of dollars via wire transfer and check to their personal brokerage or bank accounts. The pair has been charged with money laundering and various drug trafficking offenses involving the sale of controlled substances over the Internet. If convicted, the maximum penalty for each count of money laundering ranges from ten to twenty years imprisonment and the maximum penalty for each county of drug trafficking ranges from three to five years imprisonment. For their role in the conspiracy, Hudsen Smith and eight others were charged with drug trafficking offenses only.
Layer 8 in a box
Check out these other hot stories: