Adults 18-24 Report Highest Scam Risk in 2020
Online purchase scams become riskiest scam in the wake of COVID-19
Adults ages 18–24 reported the highest median losses ($150) and the highest likelihood of loss (56.6%) to BBB Scam Tracker in 2020, according to the Better Business Bureau (BBB). Previously, older age groups consistently lost higher median dollar amounts to scammers year over year, even while young adults tended to lose money more often. This year, the financial loss reported by those 18-24 was equal to that of adults 65+. Online scams rise during COVID-19 pandemic: 2020 BBB Scam Tracker Risk Report (BBB.org/RiskReport), focuses on the impact of scams in the wake of the pandemic and the demographic groups most at risk.
More scams were perpetrated online and yielded the highest likelihood of financial loss in 2020. This is likely connected to consumer habit shifts since the start of the COVID-19 pandemic; in a survey of over 5,000 individuals that reported scams to BBB Scam Tracker (BBB.org/ScamTracker) in 2020, 43.1% said they spent more time online due to the pandemic, and 57.1% said they purchased more online because of the pandemic.
“Scammers go where they feel they can best take advantage of people,” said Melissa Lanning Trumpower, executive director of the BBB Institute for Marketplace Trust, BBB’s educational foundation, which produced the report. “Not surprisingly, scams perpetrated online through websites and social media apps were the riskiest contact methods for all age groups in 2020 – including both young adults as well as older adults.”
The risk of financial loss also rose significantly in 2020. Nearly one of every two reports to BBB Scam Tracker (46.7%) noted a financial loss, with two-thirds of reports (64.7%) resulting in financial loss being online purchase scams, which was the top riskiest scam in 2020. Online purchase scams were the most common scam reported to BBB, comprising 38.3% of all scam reports. Pet and PPE-related online purchase scams spiked during the pandemic.
Recommended AI News: Persistent and FinMkt Partner to Bring Point of Sale Digital Lending Solutions
“Scammers are opportunists,” said Trumpower. “If there is a shortage of a product, or an opportunity to leverage a person’s heightened emotional state – they will use that scarcity or fear for their personal gain. Scammers will also imposter a recognizable and respected organization or brand to get your attention.”
Another way scammers take advantage of younger adults in particular is by utilizing a payment method less familiar to younger generations: checks. Fake check scams were the second most risky scam for adults ages 18-24 in a year where payment via online payment systems rose across all age groups. Fake check scams yielded one of the highest median dollar losses per encounter at $1,679 in 2020.
“Scams aren’t just a drain to people’s wallets,” Trumpower noted. “In our annual study of individuals that reported a scam to BBB Scam Tracker, a majority reported losing time and confidence or peace of mind in the marketplace, with over one-third also losing personally identifiable information in the encounter. We share these insights to help fight fraud and promote a trustworthy marketplace for all.”
Recommended AI News: Melax Technologies, Inc., Launches Turn Key LANN Software for Text Annotation