Data acquired by Finbold indicates that Australians lost $65 million (AUD) to investment scams across 2020. The losses are projected to surge 51.9% in 2021 to $100 million. Between January and February 2021, the average investment scam losses have hit $18.17 million.
According to the Australian Competition and Consumer Commission (AAAC), in 2021, businesses have recorded over $14 million in payment redirection scam losses, representing at least five times growth compared to a similar period last year. The growth rate might be replicated on investment losses hence the $100 million projection by Finbold analysis.
On a year-over-year basis, the value has been increasing to record a growth of 69.4% between 2018 and 2020. In 2019, the losses stood at$61.81 million, while in 2018, the figure was $38.84 million.
Role of pandemic and digital transformation in increasing scams
The analysis also explains the link between digital transformation and the coronavirus pandemic on the increase in scams. According to the report:
“The different forms of scam losses are likely to keep surging as fraudsters exploit new avenues to mint money from victims. With the pandemic not yet fully contained, more people will still turn to digital platforms for managing finances.”
The report further highlights the top ten scams in Australia in 2020. Investment fraud tops at 39%, followed by dating and romance at 23%. False billing losses occupy the third-largest share at 11%, or $19.32 million. Threats to life and arrests is fourth, taking a share of 7%, followed by remote access scams at 5%.
Other notable scams include online shopping ($7.38 million), Classified ($5.52 million), health and medical products ($3.91 million), identity theft ($3.07 million), and unexpected lottery ($1.7 million). Cumulatively, the top ten scams accounted for $175.66 million.
Furthermore, the analysis also explores the current outlook of scams and the future. According to research report:
“Already, 2021 has recorded significant investment scam losses accounting for almost 30% of last year’s value in just two months. The huge loss signals that investment fraud might keep surging, corresponding with the year-over-year growth trend.”
In the wake of increasing scams, there have been efforts to sensitize consumers to be on the lookout.