March 23, 2019

March 22, 2019

Subscribe to Latest Legal News and Analysis

March 21, 2019

Subscribe to Latest Legal News and Analysis

March 20, 2019

Subscribe to Latest Legal News and Analysis

Imposter Scams Top FTC’s List of 2018 Consumer Complaints

The FTC has issued its 2018 Consumer Sentinel Network Data Book. The report summarizes consumer complaints stored in the Consumer Sentinel Network, a secure online database.

For 2018, imposter scams top the list of reported complaint categories, accounting for 18% of the almost 3 million consumer reports summarized in the Data Book. Debt collection—which had crowned the list in 2017—falls to second, with 16% of all reports. Identity theft is third, with 15%.

The Data Book also provides several observations related to the general complaint categories, including the following:

  • There were more than 535,000 imposter scams reported, with almost 20% of the reported incidents resulting in a monetary loss. Nearly half of these reported scams involved government imposters that falsely claimed to be from the IRS, Social Security Administration, other government agency to get victims to turn over money and/or personal information.

  • Debt collection reports (including reports regarding, e.g., repeated calls, false representations of amount or status of a debt, failure to send written notice of a debt, false threats of suit, use of profanity, failure to identify as a debt collector, etc.) declined by 24% from 2017.

  • Credit card fraud was the most common type of identity theft report. The FTC received over 167,000 reports from people who claimed that their information was either misused on an existing account or used to open a new credit card account.The Data Book also separately analyzes reports made by military consumers, including active duty service members, military dependents, inactive reserve members, and veterans. Of 122,519 total reports by military consumers, imposter scams top the list at 29% of the reports, followed by identity theft at 23%. In contrast to the general population, however, debt collection reports account for only about 5% of the total reports by military consumers.

  • Additionally, the Data Book provides state-by-state breakdowns and comparisons. Florida, Georgia, Nevada, Delaware, and Tennessee had the highest fraud reports per capita. Georgia, Nevada, California, Florida, and Texas had the highest identity theft reports per capita.  Notably, the Data Book’s summary excludes reports related to the National Do Not Call Registry and reports about unsolicited commercial email.

While the FTC releases its annual Data Book to the public, only law enforcement organizations—including the CFPB and state attorney generals—can access the Consumer Sentinel Network database itself. This database houses reports from numerous sources, including consumer complaints made through sources including, among others: the FTC’s call center or websites, such as IdentityTheft.gov, a resource for identity theft victims, and Econsumer.gov, a site designed to promote cross-border information sharing regarding internet fraud; Better Business Bureaus for 100 different regions; PrivacyStar, a service that identifies who is calling and why; the CFPB; Publishers Clearing House; Microsoft Corporation Cyber Crime Center; and state law enforcement agencies.

The Data Book acknowledges that it is based on “the unverified reports filed by consumers.” Nevertheless, its summaries and the Consumer Sentinel Network are intended to assist law enforcement “to spot trends, identify questionable business practices and targets, and enforce the law.” Thus, as we have previously observed, minimizing the number of consumer complaints made to the FTC, CFPB, BBB, and other consumer watchdogs is an essential first step to avoid ending up on a regulator’s radar.

Copyright © by Ballard Spahr LLP

TRENDING LEGAL ANALYSIS


About this Author

DeMaree, Associate, BallardSpahr, Litigation, Commercial
Associate

Lindsay C. Demaree is an associate in the firm's Litigation Department focusing on consumer financial services litigation and commercial litigation involving real estate, insurance, and product liability claims. She regularly represents financial institutions in actions involving mortgage disputes, lien priority issues, as well as federal and state consumer protection laws such as the Fair Credit Reporting Act. Ms. Demaree also has extensive experience defending negligence and product liability tort claims for a wide array of clients, including tire manufacturers,...

702.868.7514