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According to the Federal Trade Commission, consumers reported losing more than $3.3 billion to fraud in 2020, up from $1.8 billion in 2019. Nearly $1.2 billion of losses reported last year were due to imposter scams, while online shopping accounted for about $246 million in reported losses from consumers. Feb 4, 2021[1]
For three years running, people have reported losing more money on romance scams than on any other fraud type identified in the FTC Sentinel Network. In 2020, reported losses to romance scams reached a record $304 million, up about 50% from 2019. For an individual, that meant a median dollar loss of $2,500. From 2016 to 2020, reported total dollar losses increased more than fourfold, and the number of reports nearly tripled.
While many people report losing money on romance scams that start on dating sites and apps, they say even more were targeted on social media. These social media users are not always looking for love and report that the scam often starts with an unexpected friend request or message.
Sooner or later, these scammers always ask for money. They might say it is for a phone card to keep chatting. Or they might claim it is for a medical emergency, with COVID-19 often sprinkled into their tales of woe. The stories are endless and can create a sense of urgency that pushes people to send money repeatedly.
Who are the victims?
People ages 20 to 29 saw the most striking increase, with the number of reports more than doubling since 2019.
People ages 40 to 69 were once again the most likely to report losing money to romance scams. And people 70 and older reported the highest individual median losses at $9,475.
Small Schemes – In 2020, reports of gift cards being used to send money to romance scammers increased by nearly 70%. Gift cards, along with wire transfers, are the most frequently reported payment methods for romance scams. People mailed gift cards or gave the card’s PIN to the scammer. The median amount sent to romance scammers in 2020 using any payment method was $2,500, more than ten times the median loss across all other fraud types.
Story of two women from different states – Both lost their husbands and went to a dating site to meet someone. They did; he was a Nigerian scammer, a member of the Yahoo Boys. Within days they were showered with words of endearment that quickly played on the emotions of both women. (Rule #1: New person, ask yourself could this person be a scammer, not just if he is good-looking.) The scammer advised he was an engineer in the oil fields and could only talk on the phone or Skype with them. He only showed a picture of himself and never a live video. He wanted to meet in Paris or London but had family problems that require money, small amounts at first, then more and more. Woman one was American with a large 401(k). She withdrew funds and gave them to the scammer. They agreed he would return the loan before 60 days expired to avoid penalties. Her son and daughter cautioned their mother, but she did not trust their instincts and continued to loan money to the scammer. The scammer asked her to send $2,000 to his cousin in Texas. She wired $2,000 to the woman. Later, she called the Texas woman to make sure she received the money. She found that the Texas woman was not a cousin but assisted the scammer in forwarding money to him. The Texas woman had been arrested for being involved in a money-laundering fraud scheme. At that point, both women realized they were dupped and cut off talking to the scammer.
Both women were victimized again because the 401K withdrawals required the recognition of income, payment of taxes, and a 10% penalty payment. A theft loss was considered but will not be agreed to by the IRS because unless she could prove fraud, the IRS would consider the money to be a gift. In addition, the Texas woman lost her job and had to recognize as income for all the funds that were deposited and transferred out of her accounts.
These romance schemes caused the loss of more money by victims in 2020 while people were dealing with the COVID-19 pandemic. Loneliness can cause a woman’s or a man’s senses to be diminished, so in the future, beware when talking to strangers. When dating from the beginning, be skeptical, consider the person will be a scammer, do not date long distance, use a “burner cellphone,” set up a separate email account, be wary of speech and writing differences, and on your profile do not include much information about yourself. If you see a video ask the person to remove their glasses or stand up if sitting or vice versa to verify you are speaking to the real person live, and it is not a recorded video with the sound stripped and the scammer talking behind the video. See an example of how Scammers use fake videos to make victims believe they are real at http://silentvictimnomore.com/2018/05/617/. One of the best tests to know if you are talking to a scammer or the real person in the picture is to ask them to come on video immediately. If they have an excuse, no matter how good it is to not come on video, it is a scammer, or if they do come on video and cannot do what you ask of them in real-time or the video goes off when you do ask them to do something, it is a scammer, and it is imperative for you to disconnect all contact and not engage again with this person.
If you are asked for money, small amounts, or large amounts, you are dealing with a scammer, so break off all contact. Toss the cellphone, discard the email, start over, be careful, skeptical, and keep your money and self-esteem safe.
Sage Investigations, LLC is associated with DL Garren. As a public service to individuals receiving this newsletter or reading our blog, we want everyone to be safe, prosper in their lives, and avoid being taken advantage of, defrauded, or scammed. We have attempted to help victims of various types of fraud and are pleased to bring an authority like DL Garren to our readers. DL has helped over 3,000 victims heal and get their lives back after being scammed. To read other victim stories and learn more, go to DL Garren’s non-profit website www.silentvictimnomore.com.
If you, your loved ones, or your clients need assistance with these matters, please contact Chief Investigator Edmond Martin by email at edmartin@sageinvestigations.com or call 512-659-3179. Be sure to visit our website at www.sageinvestigations.com and Click to read about our team and their CVs
[1] https://www.ftc.gov/news-events/press-releases/2021/02/new-data-shows-ftc-received-2-2-million-fraud-reports-consumers
