Main Online Scams 2018: ACCC Report

The Australian Competition and Consumer Commission’s (ACCC) 10th annual Targeting scams report highlights the increasing harm of scams to Australia.

In 2018, almost half a billion dollars ($489 million) in losses from over 378 000 scam reports was reported to the ACCC, the Australian Cybercrime Online Reporting Network (ACORN) and other state and territory government agencies. These losses represent an increase of 44% over the $340 million reported in 2017 and demonstrate that the impact of scams and cybercrime on the Australian public is worsening.

We look at the key findings and scam trends throughout 2018 as identified in the report.

 

Top scams by loss

Scamwatch is run by the ACCC. The Scamwatch website provides information to consumers and small businesses about how to recognise, avoid and report scams.

The following are the top scams reported to Scamwatch in 2018, and associated losses:

  1. Investment scams – $38 846 635
  2. Dating & romance – $24 648 024
  3. False billing – $5 512 502
  4. Remote access scams – $4 762 429
  5. Threats to life, arrest or other – $3 338 986
  6. Online shopping scams – $3 284 323
  7. Hacking – $3 128 908
  8. Unexpected prize & lottery scams – $2 745 700
  9. Betting & sports investment scams – $ 2 629 503
  10. Classified scams – $2 364 745

Scamwatch received 177 516 scam reports in 2018, representing a 10% increase compared to 2017. 2018 had the highest level of financial losses ever reported to Scamwatch with $107 million reported lost. This is an 18% increase over 2017 reported losses, which totalled approximately $91 million.

 

2018 Scam trends

The report highlights a number of key scam trends observed throughout 2018.

 

ATO impersonation scams

Scammers impersonate the Australian Taxation Office (ATO) and offer Australians rebates for overpaid taxes or threaten them with legal action for not paying taxes. These scams do not have their own Scamwatch scam category, and are commonly categorised as either ‘rebate scams’ where the victim is offered a rebate or ‘threats to life, arrest or other’ for the version of the scam involving threats for not paying taxes.

Scamwatch received 23 000 reports of these scams in 2018 with over $1.4 million in reported losses. The ATO also received over 114 000 reports with $2.8 million in reported losses making a combined total of $4.2 million in reported losses.

 

‘Threats to life, arrest or other’ scams

Reports and losses attributed to scammers threatening arrest, loss of benefits and even deportation increased in 2018 with over 19 000 reports and $3.3 million in reported losses. This represents a 45% increase over 2017 reports, largely contributed to by the the significant increase in ATO impersonation scams in late 2018.

 

False billing scams

False billing scams involve sending invoices to individuals or businesses demanding payment for directory listings, advertising, domain name renewals or office supplies that were not ordered. These scams often take advantage of the fact the person handling the administrative duties for a business processes many similar invoices without necessarily being across the details.

In 2018 losses to false billing scams increased by 97% to $5.5 million. A large portion of these losses can be attributed to business email compromise scams in which both consumers and businesses receive emails from compromised businesses asking for payment for goods or services.

 

Remote access scams

A more elaborate version of the classic tech support scam in which scammers impersonate the police and ask for access to a victim’s computer to catch scammers, resulted in increased losses for remote access scams in 2018. Scamwatch received over 11 300 reports with $4.7 million in reported losses, an increase of 95% over 2017 losses.

 

Cryptocurrencies in scams

Cryptocurrencies such as Bitcoin are increasingly being used in scams, particularly as a method of payment due to the traceability challenges faced by law enforcement.

In 2018, there were 674 reports where cryptocurrency was used to pay the scammer with reported losses of $6.1 million. This is a 190% increase over the $2.1 million reported in 2017.

 

iTunes and Google Play cards in scams

The scammer persuades the victim to buy a large number of such cards and read out the serial numbers over the phone. The scammer can then sell these unused serial numbers online, often on the dark web.

Scammers requesting payment through iTunes cards increased in 2018 with $3.1 million in reported losses. Scammers requesting payment through Google Play cards also increased with losses rising from $1250 reported in July to $179 000 in December 2018.

Whilst Apple iTunes cards remained the most requested, demands for payment via Google Play cards and other gift cards are increasing rapidly. The ACCC indicates that the shift may be a result of government efforts to display scam warnings about iTunes cards in major Australian retailer outlets.

 

How do scammers target victims?

Scammers utilise various communication methods to target victims, including phone, email, text messages and social media.

 

Key 2018 communication medium statistics:

Phone Email Text Message Social Media
% of total 46.9% 23.2% 14.4% 3.8%
Reports 83 247 41 170 25 595 6828
Losses ($ million) $30.3 $25.3 $2.14 $15.7

 

Reports of phone, text and social media-based scams increased in 2018, whilst reports of email scams decreased.

Telephone calls remained the most common way scammers contacted victims. ‘Phishing’ and ‘threats to life, arrest or other’ scams were the most common phone-based scams with 27 318 reports combined. However, ‘investment scams’ conducted over the phone resulted in the highest losses of $19 million.

Despite social media reports accounting for only 3.8% of total reports for 2018, the reported losses exceeded $15.7 million, or 14.7% of the total losses reported to Scamwatch.

Nyman Gibson Miralis provides expert defence in complex cybercrime cases. Contact us if you require assistance.