The Federal Trade Commission today
released a statistical survey of fraud in the United
States that shows that nearly 25 million adults ' 11.2
percent of the adult population ' were victims of fraud
during the year studied. Certain racial and ethnic
minorities were much more likely to be victims of fraud
then non-Hispanic whites. American Indians and Alaska
Natives were the ethnic group most likely to be victims:
nearly 34 percent had experienced one or more frauds in
the preceding year. Seventeen percent of African Americans
were victims; over 14 percent of Hispanics were victims;
and over 6 percent of Non-Hispanic whites were victims.
'We found that American Indians and Alaska Natives,
African Americans, and Hispanics are more likely to be
victims of fraud than non-Hispanic whites,' said Howard
Beales, Director of the FTC Bureau of Consumer Protection.
"These findings will help us fine-tune our Hispanic Law
Enforcement and Outreach Initiative, and explore
additional opportunities to target frauds aimed at
communities which are at risk."
The survey of 2,500 randomly chosen consumers shows that
consumers with high levels of debt were more likely to be
victims of fraud. Three of the top four categories of
fraud related to credit, including credit-repair scams
often targeted at those carrying high debt loads or having
The most frequently reported type of consumer fraud was
advance-fee loan scams, in which consumers pay a fee for a
'guaranteed' loan or credit card. Four and a half million
consumers ' 2.1 percent of the U.S. adult population '
paid advance fees but did not receive the promised loan or
card. In fact, some consumers reported that more than once
during the last year they paid fees to get loans or credit
cards they did not get.
Buyers' club memberships or bills for unordered
publications was the second most commonly reported fraud
category in the survey. Some four million consumers ' 1.9
percent of the U.S. adult population ' were unwittingly
billed for memberships they did not authorize or
publications they did not order.
Credit card insurance scams and credit repair were the
third and fourth most common frauds identified in the
survey. While federal law limits consumers' credit card
fraud liability to $50, fraudsters sell credit card
insurance by falsely claiming that card holders face
significant financial risk if their credit cards are
misused. An estimated 3.3 million consumers bought
unnesessary insurance against the unauthorized use of
their credit cards.
Some fraudsters convince consumers that they can help them
remove truthful, negative information from their credit
report, or establish a new credit record. They can't, and
credit repair schemes are illegal, but two million
consumers paid for 'credit repair' services the year prior
to the survey.
'The results of our survey indicate that fraud in the U.S.
is a serious problem,' said Beales. 'We have brought many
enforcement actions against these types of scams in the
past, and we will bring more in the future.'
The survey reveals that 33 percent of fraud victims first
learned about a fraudulent offer or product from print
advertising in newspapers, magazines, direct mail,
catalogs, or posters. Telemarketing was the first source
of contact in 17 percent of the frauds. Only 14 percent of
fraudulent offers were promoted using Internet and e-mail;
television or radio advertising account for only 10.6
percent of fraudulent offers.
Women and younger consumers are more likely to complain if
they have been victims of fraud, the survey found. An
estimated 74.5 percent of female victims complained. For
males, the complaint rate was 10 percentage points lower.
Similarly, almost 75 percent of consumers under the age of
35 complained, compared to only 55.4 percent of consumers
between 55 and 64.
According to the survey, consumers between the ages of 25
and 44 are most likely to be fraud victims. Eleven percent
of them were victims, compared to 8.7 percent in the 45 to
54 year bracket, 6.1 percent of consumers aged 55 to 64,
and only 4.7 of consumers 65 years and older.
The top 10 frauds listed in the report include:
Advance-fee loan scams ' 4.55 million victims;
Buyers clubs ' 4.05 million victims;
Credit card insurance ' 3.35 million victims;
Credit repair ' 2 million victims;
Prize promotions ' 1.8 million victims;
Internet services ' 1.75 million victims;
Pyramid schemes ' 1.55 million victims;
Information services ' .8 million victims;
Government job offers ' .65 million victims; and
Business opportunities ' .45 million victims.
In addition to the fraud categories, the survey found that
an estimated 13.9 million consumers were victims of
'slamming' ' unauthorized and illegal changes in long
distance telephone service.
For more information:
FTC: MEDIA CONTACT:
Claudia Bourne Farrell,
Office of Public Affairs
About the ICFE:
The Institute of Consumer Financial Education (ICFE) was founded in 1982 by the late Loren Dunton (creator of the Certified Financial Planner (CFP) designation). The ICFE is dedicated to helping consumers of all ages to improve their spending, increase savings and use credit more wisely.
The ICFE is an award winning, nonprofit, consumer education organization that has helped millions of people through its education programs and Resources. It publishes the Do-It-Yourself Credit File correction Guide, which is updated annually. The ICFE has distributed over one million Credit/Debit Card Warning Labels and Credit/Debit Card Sleeves world wide.
The ICFE became an official partner with the Department of Defense/Financial Readiness Campaign in June of 2004.The ICFE was an active partner in the California Student Debt Resource Awareness Project (CASDRAP) which resulted in a new web site: (studentdebthelp.org). CASDRAP disbanded in 2010, shortly after the web site project was completed. In 2011 the ICFE assumed the single sponsorship of the (studentdebthelp.org) web site and is now responsible for its content and operation.
The ICFE is also an on-line help for consumers who spend too much. ICFE's spending help was featured in PARADE Magazine in the Intelligence Report section. The money helps and tips are from the ICFE's Money Instruction Book, our course in personal finance.
Visit the ICFE's other web sites at: www.financial-education-icfe.org and studentdebthelp.org. Both sites helps consumers and students with mending spending, learning about the proper use of credit, budget and expense guidelines, how to set up and implement a spending-plan and also how to access financial education courses and how to teach children about money. Other ICFE services include: Ask Mr. G, a free eNews, and an online resource center for students, parents and educators, plus financial education learning tools and a book store.