Aussies Report a Record AU$1.5B Investment Scam Losses in 2022

Monday, 17/04/2023 | 07:30 GMT by Arnab Shome
  • The actual losses remain much higher than the reported figures.
  • Losses per victim have jumped and averaged at AU$20,000.
Australia

Australians reported a record AU$3.1 billion loss to scams in 2022, out of which AU$1.5 billion were lost to investment scams, according to the latest figures published by the Australian Competition and Consumer Commission (ACCC). The losses jumped 80 percent compared to the numbers reported in the previous year.

Australians Lost a Record Figure to Scams

While investment scams remained the highest, Aussies also lost AU$229 million to remote access scams and AU$224 million to payment redirection scams. Interestingly, traditional bank transfers remain one of scammers' most common payment methods.

The record figure came from the compiled data from the complaints received by Scamwatch, ReportCyber, the Australian Financial Crimes Exchange (AFCX), IDCARE, and other government agencies. It is the confirmed losses while the real number remains much higher.

"Australians lost more money to scams than ever before in 2022, but the true cost of scams is much more than a dollar figure as they also cause emotional distress to victims, their families, and businesses," said ACCC's Deputy Chair, Catriona Lowe.

"As scammers become increasingly sophisticated in their tactics, it is clear a coordinated response across government, law enforcement, and the private sector is essential to combat scams more effectively."

Scammers Have Become Sophisticated

The number of scam reports received by Scamwatch dropped 16.5 percent last year to 239,237. However, the financial losses increased 76 percent to more than AU$569 million. The report highlighted that the losses per victim jumped 50 percent last year and averaged almost AU$20,000.

Scammers have become sophisticated over the years, leveraging technology to lure and deceive victims. Many are even impersonating regulators and enforcement agencies to extort funds.

"We have seen alarming new tactics emerge which make scams incredibly difficult to detect. This includes everything from impersonating official phone numbers, email addresses, and websites of legitimate organizations to scam texts that appear in the same conversation thread as genuine messages. This means now more than ever, anyone can fall victim to a scam," Lowe added.

ACCC infographic on scams

Vulnerable Communities Are Prime Targets

The ACCC report further highlighted that Aussies with 'vulnerability or hardship' have reported record losses. Financial losses to people with disability jumped 71 percent to AU$33.7 million, while the indigenous population reported losses of AU$5.1 million, which is an increase of five percent.

Additionally, culturally and linguistically diverse communities in Australia reported 11,418 instances of scams with a loss of AU$56 million, which is a yearly increase of 36 percent. Reported losses to small and micro businesses, mainly targeted with payment redirection scams, jumped 95 percent to AU$13.7 million.

"We are very concerned that people experiencing vulnerability continue to be disproportionally impacted by scams," Lowe said. "Our report shows that people from culturally and linguistically diverse communities were significantly over-represented in terms of financial losses across a range of scam types, accounting for more than one quarter (27.9%) of total losses associated with identity theft and about a third (32.7%) of all losses to pyramid schemes."

Virtu integrates Appital; R3 in Qatar; read today's news nuggets.

Australians reported a record AU$3.1 billion loss to scams in 2022, out of which AU$1.5 billion were lost to investment scams, according to the latest figures published by the Australian Competition and Consumer Commission (ACCC). The losses jumped 80 percent compared to the numbers reported in the previous year.

Australians Lost a Record Figure to Scams

While investment scams remained the highest, Aussies also lost AU$229 million to remote access scams and AU$224 million to payment redirection scams. Interestingly, traditional bank transfers remain one of scammers' most common payment methods.

The record figure came from the compiled data from the complaints received by Scamwatch, ReportCyber, the Australian Financial Crimes Exchange (AFCX), IDCARE, and other government agencies. It is the confirmed losses while the real number remains much higher.

"Australians lost more money to scams than ever before in 2022, but the true cost of scams is much more than a dollar figure as they also cause emotional distress to victims, their families, and businesses," said ACCC's Deputy Chair, Catriona Lowe.

"As scammers become increasingly sophisticated in their tactics, it is clear a coordinated response across government, law enforcement, and the private sector is essential to combat scams more effectively."

Scammers Have Become Sophisticated

The number of scam reports received by Scamwatch dropped 16.5 percent last year to 239,237. However, the financial losses increased 76 percent to more than AU$569 million. The report highlighted that the losses per victim jumped 50 percent last year and averaged almost AU$20,000.

Scammers have become sophisticated over the years, leveraging technology to lure and deceive victims. Many are even impersonating regulators and enforcement agencies to extort funds.

"We have seen alarming new tactics emerge which make scams incredibly difficult to detect. This includes everything from impersonating official phone numbers, email addresses, and websites of legitimate organizations to scam texts that appear in the same conversation thread as genuine messages. This means now more than ever, anyone can fall victim to a scam," Lowe added.

ACCC infographic on scams

Vulnerable Communities Are Prime Targets

The ACCC report further highlighted that Aussies with 'vulnerability or hardship' have reported record losses. Financial losses to people with disability jumped 71 percent to AU$33.7 million, while the indigenous population reported losses of AU$5.1 million, which is an increase of five percent.

Additionally, culturally and linguistically diverse communities in Australia reported 11,418 instances of scams with a loss of AU$56 million, which is a yearly increase of 36 percent. Reported losses to small and micro businesses, mainly targeted with payment redirection scams, jumped 95 percent to AU$13.7 million.

"We are very concerned that people experiencing vulnerability continue to be disproportionally impacted by scams," Lowe said. "Our report shows that people from culturally and linguistically diverse communities were significantly over-represented in terms of financial losses across a range of scam types, accounting for more than one quarter (27.9%) of total losses associated with identity theft and about a third (32.7%) of all losses to pyramid schemes."

Virtu integrates Appital; R3 in Qatar; read today's news nuggets.

About the Author: Arnab Shome
Arnab Shome
  • 6353 Articles
  • 80 Followers
About the Author: Arnab Shome
Arnab is an electronics engineer-turned-financial editor. He entered the industry covering the cryptocurrency market for Finance Magnates and later expanded his reach to forex as well. He is passionate about the changing regulatory landscape on financial markets and keenly follows the disruptions in the industry with new-age technologies.
  • 6353 Articles
  • 80 Followers

More from the Author

Retail FX

!"#$%&'()*+,-./0123456789:;<=>?@ABCDEFGHIJKLMNOPQRSTUVWXYZ[\]^_`abcdefghijklmnopqrstuvwxyz{|} !"#$%&'()*+,-./0123456789:;<=>?@ABCDEFGHIJKLMNOPQRSTUVWXYZ[\]^_`abcdefghijklmnopqrstuvwxyz{|}