×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

FBI Reports All-Time High In Internet Fraud Losses

Soulskill posted about 6 years ago | from the hello-sir-madam dept.

Security 121

eldavojohn writes "While the number of cases dropped, the amount of money lost to internet fraud reached an all-time high in 2007, a new government report states. 'According to the 2007 Internet Crime Report, the Internet Crime Complaint Center (IC3) received 206,884 complaints of crimes perpetrated over the Internet during 2007. Of the complaints received, more than 90,000 were referred to law enforcement around the nation, amounting to nearly $240 million in reported losses. This represents a $40 million increase in reported losses from complaints referred to law enforcement in 2006.' The top ruses used by the fraudsters involved pets, romance and secret shoppers. The original report[Large PDF] is available online, and it contains some interesting graphs. One indicates that the two largest types of fraud are Auction Fraud and Non-delivery, which combine for over 60% of all cases. As Computerworld notes, men are more likely to fall for scams than women, and over 30% of losses are between $1,000 and $5,000. The report also contains data about the location of the perpetrators (Nigeria only accounts for 5.7%), age demographics, and contact methods."

cancel ×
This is a preview of your comment

No Comment Title Entered

Anonymous Coward 1 minute ago

No Comment Entered

121 comments

Still profitable (3, Funny)

edwardpickman (965122) | about 6 years ago | (#22960472)

(Nigeria only accounts for 5.7%)

Yes but to put it into perspective that still accounts for 60% of the GNP of Nigeria.

And yet... (5, Interesting)

DaedalusHKX (660194) | about 6 years ago | (#22960646)

The funniest part is that several years ago, I had a form of ID theft occur. Someone took out loans and bought property in my name... even with my SSN and all. Who lost my information? Only two candidates were possible. The credit rating agencies, or the government. Nobody else had all the data that was used, since I rarely give specific information and have a tendency to verify who holds what.

Here's the irony. I called Equifax and Experian and after verifying that the information they and I had was correct, they told me I could not receive my own credit report because I did not possess the proper ID to clear myself to them... yet when I went into trucking, they were able to run a credit check on me without so much as a single complaint!

Interesting how the actual OWNER of an identity is not permitted to know what kind of data is warehoused about him or her, but everyone else pays 15 bucks and gets a full detailed copy faxed to them over insecure lines.

I think the bullshit is in the centralized repositories of standardized and aggregated information, not the fact that it is being stolen. That is inevitable when such a heavy prize is dangled at any height. Just imagine what will happen when they tie biometric (unchangeable) data to it.

Witness protection, to say the least, will take on a WHOLE new meaning. Might change name and address and "person number" once you rat on the mafia, but you won't change your DNA or retinal scan :)

Re:And yet... (3, Interesting)

Khyber (864651) | about 6 years ago | (#22960696)

Nice story - but for those of us who want to know - what did you do to get the fraud exposed and the perpetrator arrested? Just how did you get everything handled and your name cleared?

Re:And yet... (0)

Anonymous Coward | about 6 years ago | (#22960734)

Wow, that's the funniest part of your life?

Re:And yet... (2, Interesting)

SirSlud (67381) | about 6 years ago | (#22960746)

Thats a credit economy - given a free market, the demand isn't going to come from people who need reports on themselves, the demand is going to come from people who want to check your credit. So its no surprise that the bias the market dictates is for people who want access to other peoples' credit, not the credit owners themselves.

Without regulation, it seems rather natural to me that lenders and scammers could supplant any revenue that might be had from people asking for their own credit reports by offering money to credit reporting companies because its in their best interest for people not to know their own credit rating.

Re:And yet... (1)

timmarhy (659436) | about 6 years ago | (#22961022)

free markets don't apply to everything you know.

my information isn't a publicly traded entity.

Re:And yet... (2, Insightful)

electrictroy (912290) | about 6 years ago | (#22961386)

Stop using credit cards then. No more trail for them to track. (Yes I know: inconvenient.) (It's a choice; convenience of cards? Or anonymity of using no cards? You decide.) I continue using credit cards because they offer me 1-5% off everything I buy. I don't mind the tracking as long as I'm getting back ~$1000 a year. However if that 1-5% discount ever stops, I'll switch back to cash/checks.

Also:

Congress recently passed a law that entitles the citizens to request One credit report per year from each of the agencies. So you are no longer barred from accessing your own data.

Re:And yet... (1, Informative)

Anonymous Coward | about 6 years ago | (#22965254)

"I'll switch back to cash/checks."

I'd like to know how well that'd work out next time you want to rent a car or download some iTunes.

Re:And yet... (1)

Hojima (1228978) | about 6 years ago | (#22960960)

Actually, biometrics aren't that bad of an idea. It serves as a shitty method of authentication (passwords just plain can't be beat), but as for identification, it's not so bad. You can't change the genetic sequence that you carry, but you can change the value that corresponds to it in any identification center (i.e. a sequence of T-T-C-A for some chromosome could have a value of 1-4-4-3 or 1-9-8-1).

Re:And yet... (2, Insightful)

aplusjimages (939458) | about 6 years ago | (#22961552)

Are you sure that only those two entities have that info? I remember when I signed up for my car insurance they asked me a ton of personal questions that I didn't have the answers to. They asked me stuff about my dad and which street I lived on in 1982. I couldn't believe the amount of personal history they had on me.

Re:And yet... (1)

LiquidCoooled (634315) | about 6 years ago | (#22962280)

Since the property was in your name, did you go and investigate it and end up selling it?
Was it in your town?
Was it in another country?

Please do tell more because I am intruiged as to how you technoically have a new house but haven't been able to do anything about it.

Re:And yet... (1)

icandodat (799666) | about 6 years ago | (#22965744)

This is why I use CASH. you want to fight the man? use cash. The man wants you to use credit cards to pay for everything from gas to gum. That way when the man gets sick your shit he can just turn off your number and you cease to be. You can't buy anything, you can't travel, you can't own anything, you're screwed and all he had to do to win the fight was turn off your number. I'd rather get mugged for a couple hundred bucks by some thug then have the man steal all my money by turning off my number.

Re:And yet... (1)

ehiris (214677) | about 6 years ago | (#22966258)

The aggregated information companies are also very responsible for the mortgage crisis mess.
Up until recently income could be overstated without being checked if the credit rating was high enough. That led to many people getting loans they could never afford just because they managed their credit well.

A suckers born every second. (1)

WGFCrafty (1062506) | about 6 years ago | (#22960484)

Not a big surprise, I'm sure most of us can think of at least one person who's been scammed online.

I have a friend who tried to buy an Xbox 360 for 400+ dollars on Ebay and got scammed when the lady asked him to use a payment site other than paypal.

Re:A suckers born every second. (3, Interesting)

blahplusplus (757119) | about 6 years ago | (#22960624)

Having been defrauded this year, I was defrauded by what seemed like a legimate site, only to have the site suddenly disappear after I had made my order. Even though the fraudulent site did publish the businesses phone #, had an email address, etc.

Scam's are much easier to pull off over the net, and I don't think it's a matter of suckerdom as much as distance and ease of pulling it off. There are plenty of legitimate businesses online, this is the first time I have been defrauded.

Re:A suckers born every second. (1)

electrictroy (912290) | about 6 years ago | (#22961402)

If you're a seller, it's extremely easy to scammed:
- your buyer uses counterfeit money order (no money for you)
- your buyer claims non-receipt (instant refund if you can't prove delivery)
- your buyer pays with stolen card (money gets sucked out of your account)

As a buyer, it's extremely easy NOT to be scammed:
- use paypal
- use credit card
- return item with Confirmed Delivery

I've found it extremely easy to return damaged items to a seller (even when the seller refused), and then file a claim with both Paypal and my Credit card to recover the money. ----- In one case the post office wanted to charge me $50 to return a large, heavy camera, which was waaaay too much money. So instead I returned an empty box to the seller, and threw the non-operational camera into the dumpster. I got a refund from Visa because the empty box showed "delivered".

Re:A suckers born every second. (0)

Anonymous Coward | about 6 years ago | (#22962266)

So instead I returned an empty box to the seller, and threw the non-operational camera into the dumpster. I got a refund from Visa because the empty box showed "delivered".

I'm not sure what the penalties for your false Visa claim are, but mail fraud carries jail time.

Re:A suckers born every second. (1)

LiquidCoooled (634315) | about 6 years ago | (#22962306)

So instead I returned an empty box to the seller, and threw the non-operational camera into the dumpster. I got a refund from Visa because the empty box showed "delivered".

isn't that fraud?

Re:A suckers born every second. (1)

electrictroy (912290) | about 6 years ago | (#22962470)

Isn't it ALSO fraud to mail a camera that the seller KNEW was a worthless piece'o'junk even though he advertised it as "fully operational"??? Yes of course it is.

I'm not going to waste $50 of my money mailing a broken brick back to a Known Scam Artist (which he would then pawn off on some other poor soul). Especially since the refund was only $70, which means I'd net just $20 refund!!! Nope; not gonna do it; wouldn't be prudent at this juncture.

Re:A suckers born every second. (1)

pyrr (1170465) | about 6 years ago | (#22963158)

Under most circumstances, you can take and item back to the courier and tell them you're refusing delivery, they'll just send it back to the seller. The USPS probably won't do that, but FedEx and UPS seem to be willing to do so.

Re:A suckers born every second. (1)

liquidpele (663430) | about 6 years ago | (#22963886)

Unless you can prove they knew the camera didn't work before they shipped it, it is not fraud on their part. However, it would be very hard to prove you didn't know the box was empty when you returned it. So yes, you committed mail fraud and the seller probably did not even though they were a scumbag.

Re:A suckers born every second. (1)

roaddemon (666475) | about 6 years ago | (#22961738)

If you buy something online from a shop you've never dealt with before, go to resellerratings.com and see how it is rated. Otherwise you are buying a watch from a guy on the street. And giving him $500 cash and waiting for him to go "around the corner" to get the watch for you.

Re:A suckers born every second. (5, Funny)

FoolsGold (1139759) | about 6 years ago | (#22960648)

Not a big surprise, I'm sure most of us can think of at least one person who's been scammed online.

*raises hand*

I bought Vista from an online retailer. The copy was completely legit, but I still felt scammed. And a little dirty.

Re:A suckers born every second. (2, Funny)

Artuir (1226648) | about 6 years ago | (#22960920)

How'd you run it? I bought a copy of Vista Ultimate and before I even put the DVD in the drive, my computer jumped out a window!

Re:A suckers born every second. (2, Funny)

CarpetShark (865376) | about 6 years ago | (#22961502)

I bought Vista from an online retailer. The copy was completely legit, but I still felt scammed. And a little dirty.


That's because, as the article says:

One indicates that the two largest types of fraud are Auction Fraud and Non-delivery, which combine for over 60% of all cases.


The other 40% is Windows.

Prosper.com (-1, Offtopic)

Anonymous Coward | about 6 years ago | (#22960488)

Many people freely give their money away on sites like Prosper.com [prosper.com]

Do you want your post to matter more? (5, Funny)

Overkill Nbuta (1035654) | about 6 years ago | (#22960494)

Are you interested in this topic? If you want your post to matter more just go to www.slashdotpro.com Just enter your name, social insurance, and credit card info and your set to go! Be posting on slashdot like a pro.

Re:Do you want your post to matter more? (0)

Anonymous Coward | about 6 years ago | (#22963758)

Will you also send me some V1gr1@ or put me in contact with Dr. Mubgasso of Sierra Leone who has millions of dollars he'd like to share with me?

pretty obvious ruse (2, Insightful)

Anonymous Coward | about 6 years ago | (#22960540)

So the scammers send you money and ask you to send some of it back.. or to a 3rd party....

who exactly is falling for this? wow.

Re:pretty obvious ruse (0)

Anonymous Coward | about 6 years ago | (#22960940)

So the scammers send you money and ask you to send some of it back.. or to a 3rd party.... who exactly is falling for this? wow.
The scammers send you money as a check from a foreign bank. Your own local bank cashes the check. The scammers for whatever reason ask for a refund, for instance their mom dies or whatever... You refund them the money, but of course you're no fool -- you make damn sure the check was cashed successfully by your bank before you refund them any money, then...

A couple of weeks later, your bank tells you that the check is bad -- and it retracts the money from your account.

That's it. If you knew this could happen to you, then my hat is off to you. That's all I got to say.

Re:pretty obvious ruse (0)

Anonymous Coward | about 6 years ago | (#22962430)

As a prosecutor, I can tell you. A lot of people.

I recenter has a Nigerian scammer apprehended as he was sending out 50 forged checks a DAY. It was the standard, "I'm sending you a check for more than the agreed upon amount, just keep $50 for your troubles and then Western Union me the difference" scams. But if only 2 people a day were buying into the scam, he was making $5K a day.

I find that the biggest problems are the banks. They are in such a hurry these days to make the funds available to their customers, that the average consumer believe that the check has actually cleared when the funds show up in their account. I have actually had banks TELL their customers that a check has cleared and then two days later say that it was in fact forged.

New victims? (4, Interesting)

Harmonious Botch (921977) | about 6 years ago | (#22960544)

Is this a new wave of fraud, or a new bunch of stupid victims? I read the article, and saw nothing that didn't scream fraud to anybody with more than a dozen functioning brain cells.

Re:New victims? (2, Funny)

houstonbofh (602064) | about 6 years ago | (#22960618)

Internet targeted marketing allows you to reach a maximum number of stupid people guaranteeing success in your fraudulent endeavors. Included in our package is the document "Ten Thousand ways to find Stupid People.pdf" and a free spell checker to give misspellings guaranteed to engender trust. Just send $1500 to our trusted escrow agent...

Re:New victims? (1)

sacrilicious (316896) | about 6 years ago | (#22961514)

I read the article, and saw nothing that didn't scream fraud to anybody with more than a dozen functioning brain cells.

Agreed. I found it interesting how the article described different scams with inconsistent amounts of detail. For example, when the article discussed the pet scam thing, it described how an over-paying check would be mailed to a pet owner, with a request that the owner wire the difference to someone else who would be caring for the pet... only (elaborated the article) for the owner to eventually discover that the check was bad, and that they were out the wired money. Compare that description to the article's discussion of the romance scam; the article simply says that the remote love interest would request money for traveling to come see the scam victim, and might become sick or get mugged on the trip and end up needing more money... but in this case the article doesn't spell out that the person in fact never shows up, and that the "sickness" or "mugging" isn't real. To me, the article needn't spell out either scenario to its end, the scams are obvious from their skeletal descriptions; but I find it interesting how in one case the article seems like it's targeting five year olds, and in the other the article seems to presume that readers will fill in the blanks.

Re:New victims? (1)

lastchance_000 (847415) | about 6 years ago | (#22962258)

It's simple - they're all the same scam. The author is just varying the amount of detail so each paragraph doesn't read exactly like the previous one.

1. Gain the trust of an idiot.
2. Get them to send you money.
3. Profit!!!

Re:New victims? (1)

mpe (36238) | about 6 years ago | (#22965508)

For example, when the article discussed the pet scam thing, it described how an over-paying check would be mailed to a pet owner, with a request that the owner wire the difference to someone else who would be caring for the pet... only (elaborated the article) for the owner to eventually discover that the check was bad, and that they were out the wired money.

This kind of "overpayment fraud" can be much more general. It dosn't even need to involve The Internet either. Typically the fraudster is using the banking system in such a way that payments to them clear considerably more quickly than payments they make.

Re:New victims? (1)

Hoi Polloi (522990) | about 6 years ago | (#22963792)

...saw nothing that didn't scream fraud to anybody with more than a dozen functioning brain cells.

You just answered your own question, though I would also add greed to that list.

Efficiency (4, Insightful)

Jessta (666101) | about 6 years ago | (#22960562)

The internet increases efficency of communication, bring more people in contact than ever before.

Unfair (2, Funny)

CSMatt (1175471) | about 6 years ago | (#22960566)

As Computerworld notes, men are more likely to fall for scams than women, and over 30% of losses are between $1,000 and $5,000.
Hey! It's not my fault that the most interesting and nifty stuff is only available online!

Re:Unfair (1)

timmarhy (659436) | about 6 years ago | (#22960666)

i wonder if they adjusted that figure for the fact men spend more online, and that there are more men online then women.

I highly doubt it.

Re:Unfair (0)

Anonymous Coward | about 6 years ago | (#22960712)

It probably has more to do with men weighing risk differently than women. Men are much more likely to 'take a chance' in order to earn a higher reward.

Re:Unfair (1)

ulash (1266140) | about 6 years ago | (#22961124)

I think this only makes sense. There are so many spam emails geared towards men. How many women would have the same ... ahem... incentive... to open an email entitled "See Angelina Jolie nude!"?

Re:Unfair (1)

treeves (963993) | about 6 years ago | (#22965708)

I highly doubt it too, because AFAIK, there are more women online than men [emarketer.com] .

They're doing different things, to be sure. Women use it more for social activities, men more for browsing and collecting (hunting and gathering?). I think some of the reports consider using e-mail as being online. I do believe that you are correct in saying that men spend more money online than women.

My wife and I are somewhat exceptions in the spending category. Although I spend more time online, and she does spend a lot of time using e-mail, she pays our bills and occasionally buys things online. I almost never do that.

Some Harvard and Berkeley researchers wrote a paper on their findings about Why Phishing Works [harvard.edu] to explain the success of one type of internet scam.

Re:Unfair (0)

Anonymous Coward | about 6 years ago | (#22961276)

Indeed. Like those german scat videos. Oh wait...

Lies, damn lies and statistics... (2, Funny)

fahrbot-bot (874524) | about 6 years ago | (#22960584)

Auction Fraud and Non-delivery, which combine for over 60% of all cases ... Nigeria only accounts for 5.7%.

Yes, but non-delivery of Nigerian auction purchases - HUGE.

Corporations should be held more accountable (2, Interesting)

pandrijeczko (588093) | about 6 years ago | (#22960602)

Corporations, particularly financials, have absolutely no interest in dealing with any fraud that falls within their measured & predicted statistics because they can always make their customers subsidise any fraud - for example, if an organisation predicts they will lose, say, £10,000,000 due to fraud over the next year then unless that figure is greatly exceeded, then they'll just adjust interest rates/premium costs/item costs to all of their customers to allow for that potential loss as it's easier to do it that way rather than dealing with the core problem.

Therefore, the only way to force them to deal with fraud is to "name and shame" those companies by forcing them to release their fraud figures to the public eye.

I myself deal with VoIP security for a company selling converged business solutions and the amount of cover-up of hacking & toll fraud in many corporations is truly astounding.

Re:Corporations should be held more accountable (3, Insightful)

Harmonious Botch (921977) | about 6 years ago | (#22960620)

Sorry, but I gotta call BS on that.
Financial corporations only give up on fraud when the cost of recovery is more that the amount defrauded - and sometimes even then they persue the fraudster just to set an example, for they don't want to be known as an easy mark.
They can't just raise their rates and let the customer cover it, because they have competition which might be more efficient and run them out of business.

Re:Corporations should be held more accountable (1)

Detritus (11846) | about 6 years ago | (#22960728)

That's a problem. I've seen companies get repeatedly shaken down by nuisance lawsuits because they believe it's cheaper to settle for $20K than to spend $60K fighting it in court, even though they have an excellent case. That's true in the short run, but how much does it cost the company in the long run to be viewed as an easy mark by every lawyer in town?

Re:Corporations should be held more accountable (1)

pandrijeczko (588093) | about 6 years ago | (#22960740)

Financial corporations only give up on fraud when the cost of recovery is more that the amount defrauded

My point exactly. It's still fraud so why should they give up investigating it because of the costs? Surely if any fraud was investigated, more criminals would be caught, thus acting as a bigger deterent to others trying in future.

Re:Corporations should be held more accountable (1)

PunkOfLinux (870955) | about 6 years ago | (#22961598)

You would honestly be surprised how little of an effect arrest has on deterrence. Trust me. I'm studying criminal justice in college.

Re:Corporations should be held more accountable (3, Funny)

timmarhy (659436) | about 6 years ago | (#22960660)

I just knew it was those evil corporations all along. even when it was the criminals, i just KNEW somehow it was the corporations....

Re:Corporations should be held more accountable (2)

pandrijeczko (588093) | about 6 years ago | (#22960718)

I just knew it was those evil corporations all along. even when it was the criminals, i just KNEW somehow it was the corporations....

Yep, and I just knew there'd be a response from someone totally warping what I said.

In actuality, if corporations revealed fraud information rather than covering it up, it would help in the capture of the perpetrators.

all time high in stupid (1)

timmarhy (659436) | about 6 years ago | (#22960612)

fraud profits from dumb/greedy people. sure a few people get scammed on ebay etc, but the big numbers in this come from really stupid people who fall hook line and sinker for 419 scams and the like.

Re:all time high in stupid (1)

MichaelSmith (789609) | about 6 years ago | (#22960852)

Its funny. Today a co-worker (a software engineer like me. Not young. Probably in his 30's) sent an email around on our internal news server asking if it was a scam.

It was an obvious 419 scam so I replied as such. Then he replied saying "what's a 419 scam"? and I gave him a wikipedia link.

I haven't seen many of these going around lately which may be a factor. They are pretty easy to filter.

natural selection? (3, Interesting)

ch0knuti (994541) | about 6 years ago | (#22960616)

Maybe it's just evolution on a high tech scale?

Re:natural selection? (1)

maxume (22995) | about 6 years ago | (#22961758)

There is a negative correlation between intelligence and immediate reproductive success and there is a negative correlation between income and immediate reproductive success, so probably not, at least not in the way that you are thinking.

pets scam (1)

planckscale (579258) | about 6 years ago | (#22960700)

Why is it that people will pay thousands of dollars for a pet, over the internet, without actually visiting the pet? I mean, we found the most awesome dog at the local shelter; there are plenty of "save the breed" outfits that will get you the breed you want. And are men simply the victims of their partner saying "its sooooo cute!" and they gladly open their wallet and wire the money?

Overall I think the pet industry is aberrant and should be governed by the CDC.

Re:pets scam (1)

LunaticTippy (872397) | about 6 years ago | (#22965590)

The scammers specialize in fashionable purebreds and puppies, both of which are harder to find. I don't know why people would pay large sums of money for a dog sight-unseen, but it happens a lot.

Nigeria (2, Informative)

Detritus (11846) | about 6 years ago | (#22960784)

Many of the Nigerian scammers have just relocated to other countries, including the USA and Canada. It's not like they've seen the light and renounced their life of crime.

Sites need to be more accountable (5, Insightful)

v(*_*)vvvv (233078) | about 6 years ago | (#22960798)

Paypal is one of the least secure financial sites on the internet. Not only are email addresses used as user names, there are no secondary passwords or pins for transactions, no confirmation emails, not even IP tracking or blocking. Then there is the issue of accounts being linked with eBay with passwords often matching. So a hijacked ebay account can easily lead to a hijacked paypal account, and often times the hijacked accounts come with great feedback.

But when paypal or ebay get's compramised, they don't go to the police. They take absolutely no responsibility for their lack of security, and they don't even try to prevent future crimes. 120% of their work goes towards dodging blame and making the victim pay for their losses and do any paper work.

These sites are the perfect accomplices for online criminals. And they profit from it. All those fake handbags and sneakers on ebay still account for millions in listing fees and work towards their usage statistics.

The police need to investigate these crimes and send the bill to the sites where the crime occured. They should also automatically fine the criminals 20x what they stole and charge them for rent for the time they lock them up (which can be as little as 3 days, I don't think this matters).

Credit card companies are also to blame. Now it is easier than ever for buyers to file false claims and get merchandise for free. If any credit card fraud occurs, even in the smallest amounts, these cases need to be processed by law enforcement and fines need to be handed out. Too many people know they can get away with it, and keep repeating the same crime.

Re:Sites need to be more accountable (0)

Anonymous Coward | about 6 years ago | (#22961482)

Do some research before posting nonsense.

The responsibility of your identity is yours alone. If you use the same password with paypal as you use with eBay and your personal email address, that is your foolishness. eBay is not your mother, even though it tells you over and over and over again how to protect yourself online, engaging in unsafe acts is going to hurt you eventually.

eBay's stance is correct, it is just a venue. If your transaction goes bad you either:
- Chargeback through your credit card
- Chargeback through PayPal

If you paid by any other means, eBay can't do anything more to the other guy than you can through the court, if you want to recoup the cost, you goto court. But you could avoid that expense by simply not being greedy in the first place and use only payment methods that will cover you.

Anything eBay can do, only affects the sellers status on eBay, they do not physically have the merchandise.

Did you know that if something goes wrong with PayPal, whether you are the buyer or the seller, you need proof? This is why I say stop being greedy. If you pay for registered/insured post, you make sure you get the tracking number from the other guy. If it's invalid, cancel the transaction immediately. The trouble is people usually put too much blind faith in the other seller to do the right thing, or that the post office is the champion of perfection.

Re:Sites need to be more accountable (1)

jackbird (721605) | about 6 years ago | (#22962340)

That's funny, I used paypal to send a moderately large sum to a contractor in NZ from the states, and I got a confirmation phone call within 5 minutes of posting the transaction.

Re:Sites need to be more accountable (0)

Anonymous Coward | about 6 years ago | (#22963730)

I don't work at paypal but I am in the industry.

Paypal does take cases to Law Enforcement. However, not all cases.
If the case is above about $50k then they probably send it to law enforcement. Why don't they send more?
Simple, law enforcement is too busy with Terrorism and child porn to spend 5 minutes on anything less than $100k.
Not that I blame them, child porn is more important... they just don't have staff... it is the wild west out there.

When someone does get caught by law enforcement, say for a $200k loss, the judge will take pity on them with their gambling addiction and tell them to pay paypal $10k and do 100 hours community service and not to do it again.

Secondary passwords etc do not work as currently implemented... 80% of account takeover is from malware on the user's machine with keylogging and often screen capturing. Paypal does examine IP addresses. Paypal has not had a security breech.

Definitely agreed that law enforcement needs to grow, cc companies are to blame.

Re:Sites need to be more accountable (1)

Dark_Gravity (872049) | about 6 years ago | (#22964466)

Paypal is one of the least secure financial sites on the internet. Not only are email addresses used as user names, there are no secondary passwords or pins for transactions,
Really? What's this then?

https://www.paypal.com/securitykey

Re:Sites need to be more accountable (1)

jschottm (317343) | about 6 years ago | (#22967262)

Paypal is one of the least secure financial sites on the internet. Not only are email addresses used as user names, there are no secondary passwords or pins for transactions

You mean like this [paypal.com] ?

Then there is the issue of accounts being linked with eBay with passwords often matching.

That's a user/human problem, not something specific to E-bay and Paypal. While, in this case, because the two are the same company they could force consumers to have different passwords, it would negatively impact the user satisfaction and it wouldn't solve the problem that the same password is likely to work on the user's online banking as well.

The police need to investigate these crimes and send the bill to the sites where the crime occured.

Do you propose the same thing should apply to physical crimes as well?

They should also automatically fine the criminals 20x what they stole and charge them for rent for the time they lock them up (which can be as little as 3 days, I don't think this matters).

Many criminals are criminals because they don't have any money. Shall we lock them up if they are unable to pay? It's been tried already. Take away hope and you only force criminals into greater levels of dangerous activity.

If any credit card fraud occurs, even in the smallest amounts, these cases need to be processed by law enforcement and fines need to be handed out. Too many people know they can get away with it, and keep repeating the same crime.

All big business is a matter of risk analysis and risk assessment, and believe me, the credit card companies spend an awful lot of effort on the issue. There is a level of crime and fraud where the effort and more importantly cost to prevent and prosecute offenders is greater than the cost of just writing off the damage. And the biggest groups of criminals are aware of where that limit is and make sure that they stay under it. And given that a large amount of fraud and theft is overseas in countries where getting someone prosecuted is difficult if not impossible, how much time and money do you think is reasonable to spend trying to chase them?

Don't get me wrong, there are problems with the system that should be fixed, but it's not as simple as you make it out to be.

The secure way to store your money. (1)

suck_burners_rice (1258684) | about 6 years ago | (#22960818)

The big problem is how everything has become so computerized lately. It's not a bad thing for the most part, but when it comes to money, what happened to keeping the loot somewhere safe? Nowadays, some dude could steal a billion bucks without moving more than a few fingers over a keyboard. How to avoid this problem? Buy a large and very, very heavy safe with a quality locking system. Bolt it to the concrete foundation of your home. Build a frame around the base and pour concrete, thereby enclosing the bolting job in several inches of concrete and making the attachment very permanent. If someone wants to bust into this thing, they'll have to come with jackhammers, heavy duty metal cutters, and if they intend on busting the safe open elsewhere, lifting equipment. By then, someone will hear all this noise. Keep your money in cash in this safe. Nothing in any bank. And keep the darn thing locked up tight. Let the cybercrooks figure that one out.

Re:The secure way to store your money. (3, Insightful)

Titoxd (1116095) | about 6 years ago | (#22960978)

The only problem there is that you would be watching your money evaporate inside the safe, due to inflation's effect on the value of a dollar.

Re:The secure way to store your money. (1)

electrictroy (912290) | about 6 years ago | (#22961494)

Inflation (or as I call it: devaluation) doesn't affect "real" money like gold, silver, or diamonds. Devaluation only affects the fake paper money.

I don't have any gold now but I'm planning on getting some. It's the only way type of wealth that keeps its value, even if the paper system collapses and/or banks close & take your money with them.

Re:The secure way to store your money. (1)

denzacar (181829) | about 6 years ago | (#22962212)

If someone wants to bust into this thing, they'll have to come with jackhammers, heavy duty metal cutters, and if they intend on busting the safe open elsewhere, lifting equipment.
Nah.. all they need is some duct tape.

First to tape over the windows when they break them to come in, and then to tape you and your family to your beds.
Then they can proceed to maim, rape and kill you (not necessarily in that order) one by one until you give up the combination.
And they will surely kill you later when they open the safe and find only couple of hundred in cash and a signed photo of Richard Stallman.

You don't keep money in the bank so it does not get stolen. Banks get robbed - its a fact.
You keep it there so WHEN it gets stolen - it is not you that robbers shoot at.

Inflation (or as I call it: devaluation) doesn't affect "real" money like gold, silver, or diamonds. Devaluation only affects the fake paper money.

I don't have any gold now but I'm planning on getting some. It's the only way type of wealth that keeps its value, even if the paper system collapses and/or banks close & take your money with them.
Dude... you do realize that gold and diamonds are basically worthless?
Buy land.
What do you think will be wanted more when we hit a 10 billion population mark? A nice big chunk of personal space or some shiny pebbles?

Hint: Buy some land east of California. [imdb.com]
Then steal some of those nuclear missiles army has stockpiled somewhere and fire them at San Andreas fault line.
You will need only 3 people to do this, providing one of them is a blond female with large breasts.

Watch California sinking into Pacific. Enjoy your new prime beach property. Make fortune as the owner of Beverly Hills 2.0.
No pesky good-doers to stand in your way on THIS Earth.

Different title (2, Interesting)

FreeDisk.nl (1181167) | about 6 years ago | (#22960822)

"FBI Reports All-Time High In Internet Fraud Losses" should be: "FBI uses scare tactics on public to further future agenda of restricting internet even more" I do get scared when I read these kinds of messages. Scared that 'the public' might fall for this and say: "YES! We DO want restrictions! Because we have to protect 'our great nation' against (and here we go) terrorism, crime and child pornography and everything else that we could be scared about."

What can I say? People are stupid (0)

Anonymous Coward | about 6 years ago | (#22960898)

In Finland there was very recently WinCapita or winclubcapita or something like that. A website that told you to invest minium of 3k euros (=4700 us dollars) and you would get 400% yearly profits. Oh, and you are only supposede to talk about it to people you want to invite there. Sounds VERY shady, yes?

Well, apparently 10 000 people fell into it in Finland.

Most were farmers and such that but hell, biggest investment was 500k euros (780 000 us dollars) so... yeah.

Apparently the site suddenly vanished and the finnish police reported that the owners of it are in Thailand.

It's a crime to let too stupid people keep their money.

The Real Culprit: Unauthenticated EFTs (5, Interesting)

MichaelCrawford (610140) | about 6 years ago | (#22960984)

... electronic funds transfers, and automated clearinghouse "checks".

Back in the day when I was a young coder - that was in a whole different century, mind you - we had these paper gadgets called "checks" that couldn't be cashed unless the account holder signed them. Our banks kept records called signature cards to compare them to, to make sure the checks were legit.

Even when Automatic Teller Machines came along, you needed both a card and a Personal Identification Number to withdraw cash.

But these days, anyone who knows your routing number (bank and branch number) and your account number can initiate an EFT to rob you blind! Yes, they'll get caught eventually - but your money will be long gone.

I understand that the banking industry is losing ten billion dollars a year worldwide this way. You'd think that would be enough to get them to require some kind of authentication, but I guess the efficiency savings from not having to process paper checks makes up for it.

Small comfort to the victims though.

A friend of mine who is a professor, with a PhD and very prominent in his field, with a big grant and legions of grad students, fell for a phishing scam. They withdrew $4000 from his account. He'd never heard of phishing before. So you see, the scams do pay off sometimes.

Re:The Real Culprit: Unauthenticated EFTs (1)

Detritus (11846) | about 6 years ago | (#22963250)

Even when checks were on paper, it was rare that any bank looked at the signature. I've seen plenty of forged checks that looked like they were created by a second grader. The bank normally just has someone read the numeric amount and type it into a MICR printing machine. Everything else runs on autopilot without human intervention. I was told by a banker that it was cheaper for them to correct any errors after the fact, when the customer complained.

Two surprises for me... (4, Interesting)

Eth1csGrad1ent (1175557) | about 6 years ago | (#22961098)

1. Bank phishing is almost non-existent according to the docs - from the PDF I assume comes under Identity Fraud which in total comprises 2.9 % of overall internet fraud. Given that this number is all Identity Fraud, not just phishing, can we assume that people have finally gotten the message about opening emails from their bank ? Or is there a more covert reason in that banks are unwilling to admit to being stung and therefore payout the complaint without telling the autorities ??? (I would have thought this would be the most profitable online scam out there)

2. Russia. Only 0.8 % of Internet Fraud comes from Russia ??? For all the bad press over the years... Is anyone else having a hard time accepting this number ?

This one answers itself. (1)

Hasai (131313) | about 6 years ago | (#22963182)

2. Russia. Only 0.8 % of Internet Fraud comes from Russia??? For all the bad press over the years... Is anyone else having a hard time accepting this number?
I highlighted the answer to your question above, in the quote.

Why is it that so many people automatically take as holy gospel anything written by some kid who came slouching out of some no-name college with a Journalism degree in his paw, and who probably never set foot in Russia in his life?

Law enforcement needs to grow up. (5, Informative)

v(*_*)vvvv (233078) | about 6 years ago | (#22961100)

The worst advise law enforcement can give are along the lines of:

1) look at feedback. make sure that the seller has a positive track record.

2) if the sellers asks for cash or money orders be suspecious.

3) make sure that the contact information is valid

This kind of advise is completely misleading, because it gives the impression that caution and education are the keys to crime prevention. On the contrary, smart crooks will use these exact elements to manipulate their victims!! How? It is easy for a crook to "steal" feedback. It is easy for a crook to dodge #2, and it is also easy for a crook to emulate #3.

The bottomline is extremely simple. If someone wishes to con someone online, it is absolutely 100% doable. The only way to protect yourself is through insurance. There is absolutely no other way. The worst thing you can say to a victim is "duh, you should have known better". Sure, there are people who will fall more easily to careless cons than others. But the bottomline is still the same. There are ways of stealing identities and getting paid that are completely unavoidable. To the victims, these cases are sheer bad luck. And the criminals deserve the worst because they know what they are doing and they will most likely do it again knowing that it works.

Currently, the only viable option for insurance is credit card fraud protection. If your merchandise doesn't arrive, then just dispute the charge. This does have a huge flipside though. This same insurance that protects buyers is used for buyer fraud. Eventhough the merchandise arrived, they would call anyway and try and get their money back. For sellers, paypal's seller protection policy is the only insurance against this tactic.

Paypal "seller protection"? Hah. (1)

pyrr (1170465) | about 6 years ago | (#22963590)

I've had repeated issues with buyers attempting to defraud me, and trust me, Paypal's so-called "Seller Protection Policy" is utterly nonexistent.

Two examples from my personal experience:

  • I ship buyer a laptop part. He tries it out, it doesn't fix the problem, so he files a complain with Paypal and gets my money back. I lose on shipping and wind up with a used part.
  • I ship a buyer a used Thinkpad which I ran the restore utility on, it shipped basically with Windows sysprep coming-up on boot. Buyer claims it "doesn't work as fast as it should", refuses to try to make it work, and makes up all manner of lies about the laptop: he checked EVERY not-as-described box available. Paypal ignores my side of the story, forces the return/refund, and charges me their full fees a second time because I contested the refund (I got that reversed, at least, I protested and they felt like being "generous"). The laptop (thankfully!) arrives back in perfect condition without sysprep even having completed, there's no way the buyer even booted completely into Windows.

Basically, they always side with the buyer, who might file a chargeback! If the seller isn't bullied into just giving-in and authorizing the return/refund, then charge them the full fees on the transaction on top of taking every penny of the original amount back too. Seriously, if someone sends you $1000 through Paypal, you wind up with, say, $972.00 after they take out their fees. If the buyer complains and the seller doesn't roll-over, Paypal will force the refund anyway, attempt to take back your $972.00, and then charge you another $28.00 fee, leaving you holding the bag for whatever you spent on shipping AND that fee. Yes, even though you only received $972.00 in the first place, they try to double-dip and put you on the hook for the full $1,000 of the original transaction, even if the buyer doesn't file a chargeback. The rep confirmed that this is, in fact, their policy.

If that's "protection", I don't want it. I don't use eBay or Paypal anymore,this Power Seller is finished. I'm tired of the shenanigans, buyers apparently know that Paypal will always side with them and it's the best way to commit fraud, even if it's just buyer's remorse. No thanks, I'm done with that.

Re:Law enforcement needs to grow up. (1)

kesuki (321456) | about 6 years ago | (#22966648)

this reminds me of google product search. for a while i was bothering to report pirate software sites on google product search to suitable websites where you can report software piracy... but it was getting really hilarious after a few attempts, the EXACT product search i was doing to find the pirates was now turning up ad-sense ads for Pirate software sites!! LOL because i had managed to get enough pirate software removed from product search, they were now using Adsense to get their products out to the those thinking they 'were getting a bargain' buying say photoshop or windows xp for less than $50...

I stopped doing it at that point, because it was a severe waste of my time. as the saying goes 'a fool and their money are soon parted' a lot of online scams ARE very easy to spot, i don't use auction sites, but then again most of what i would buy would cost more on an auction site anyways.

All bureaucracies... (1)

Clay Pigeon -TPF-VS- (624050) | about 6 years ago | (#22961206)

...report what will keep them growing on the backs of the tax payer. If federal-jurisdiction crime goes down, do you think the FBI will let us know? No. If gun crime goes down with the BATFE let us know? Of course not. All regulatory agencies have a vested interest in more stringent regulations, because it will mean more unwitting violations and more dollars for their coffers.

Secret Shopper Fraud (1)

DKlineburg (1074921) | about 6 years ago | (#22961326)

My "X" loved these. I don't know if it really fraud, or just really good sales technich. Basicly she was told to go shop here and she would get re-imbursed. Well sometimes she got paid, and sometimes, well it came back that there was an "error" and she couldn't get re-imbursed. I wonder how many company's pay someone to "get" shoppers in there store, and that "someone" gets scams to have people send money, and make it impossable to "do it correctly" so they don't have to re-imburse. I know it isn't exactly what people think of for this scam. I kept telling her to stop, but she never did listen.

Fraudulent Links (0)

Anonymous Coward | about 6 years ago | (#22961354)

Do those numbers include all the people who clicked the FBI's fake links to child porn?

Why are men falling for these scams? (1)

aplusjimages (939458) | about 6 years ago | (#22961562)

Today I was checking my gmail spam box to make sure good stuff didn't get filtered into there and there was an email for "See sex videos of Sarah Jessica Parker". What man would fall for that? I'll pass if Parker is making the list these days.

Re:Why are men falling for these scams? (0)

Anonymous Coward | about 6 years ago | (#22961662)

You did WHAT?! You aren't supposed to check it! You are supposed to trust that what google allows through their (spam) filters is good for you and what they don't allow isn't. You might anger Google if you try stunt like that again...

Re:Why are men falling for these scams? (1)

aplusjimages (939458) | about 6 years ago | (#22961756)

Sometimes Google gets it wrong (just between you and me). For a while the filter would put my Google Calendar notifications in the spam box and I had to keep reminding them that it wasn't spam. So now I check it all the time.

Not interesting (0)

Anonymous Coward | about 6 years ago | (#22962112)

That's like reporting in the late 50s that TV viewing was at an all time high. The phrase "all time" obviously doesn't mean all time because the stuff hasn't existed that long.

Interesting quote (1)

Kingrames (858416) | about 6 years ago | (#22962126)

"While the number of cases dropped, the amount of money lost to internet fraud reached an all-time high in 2007"

This is usually a sign that the persons involved are more organized and sophisticated.

After all, why scam millions and get $.02 from each one when you can scam a few, get a whole lot of money out of each, and take advantage of their unwillingness to admit they've been duped?

We're obviously talking about a group that is maximizing their profit returns on this, and we should be especially worried that those involved might be in key positions in governmental agencies.

How to scam /.ers (1)

TheMadTopher (1020341) | about 6 years ago | (#22962442)

Dear lucky /. recepient,

You have won the software lottery, which will automatically read the /. articles for you and uplink the knowledge to your account. You will be able to post with great praise and get informative & interesting karma on all topics! Just please reply back with your name, address, bank account and social security number.

Nigeria is 3rd on perp list (0)

Anonymous Coward | about 6 years ago | (#22963558)

"[...]China has been named as the source of many online attacks over the past year, but it didn't make IC3's list of top 10 countries by perpetrators. Leading the list were the US, the United Kingdom and Nigeria. "

Although it's 5.7% it's still 3rd on that list.

U mean we're not all members of THE PORTLAND CHAP? (1)

heroine (1220) | about 6 years ago | (#22965258)

Like millions of people, U probably got that $4 charge from THE PORTLAND CHAP. All it takes is 1 insecure website, break in, charge $4 to a million credit cards. No-one notices.

reported value... (1)

kesuki (321456) | about 6 years ago | (#22966540)

A lot of online crime doesn't get reported as online crime. say for instance, most types of identity theft, in general they're gaining the information online, but doing the crimes offline, so they don't get reported as internet crime.

so there is a huge skew between the amount of money stolen online, vs the amount on 'online crime' reported. I've heard (on TV shows) of figures as high as $6 billion a year globally for credit card/bank fraud etc that is done online, but because the victims don't go to a website to enter that information it isn't counted as 'online' crime even though the credit card data was transfered over the internet via compromised computers, and the stuff purchased with those credit cards was done online as well, but still, it's not called online crime because the person finds out when they try to get a new credit card and are denied... they find out off-line so it's considered an off-line crime even though the bad guys could do nothing without computers to do their dirty deeds.

Stupid Credit Card Systems == Fraud Bait (1)

ka9dgx (72702) | about 6 years ago | (#22967420)

The fact that knowledge of a 16 Digit number and minimal knowledge of someone (which leaks everywhere) allows you to take someone's money is just plain stupid. We're not living in the 1950's anymore. There's enough computing power to do two-factor authentication, or failing that, the credit card company could offer a way to generate a ONE TIME USE authorization code to hand to a vendor for each distinct purchase.

It's not that hard to do... why can't they get off their collective asses and do it?

--Mike--

Load More Comments
Slashdot Account

Need an Account?

Forgot your password?

Don't worry, we never post anything without your permission.

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>
Sign up for Slashdot Newsletters
Create a Slashdot Account

Loading...