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Internet Fraud Is Rising, and Fake News Is Adding to the Problem

By William Vogeler, Esq. | Last updated on

Internet fraud rose again last year, and scammers are at this year with fake news.

According to recent reports, fraudsters are creating fake news sites with links to trick users into buying bogus products online. The Federal Trade Commission says an investigation uncovered scams for "brain booster" pills.

"They build spoofed websites that look like the news sites that we know and trust," the government said. "The sites aren't real news sites and the endorsements featured on the sites, often from figures like Stephen Hawking, Anderson Cooper and others, are fake."

With fake news adding to the problem, it's hard to know what cyber criminals are actually doing and what they will do next. But here are some things to watch out for:

1. Identity Fraud Hits Record Number

According to a new study, identity thieves cheated a record 15.4 million Americans -- up 16 percent from 2015. Despite government and private efforts to fight the crime, NBC reported, the cyber crooks scammed two million more victims and stole $16 billion dollars, nearly a billion dollars more than the previous year.

"The criminals are getting better at committing this fraud," said Al Pascual, research director and head of fraud and security at Javelin Strategy & Research. "They learn and they adapt and they find workarounds to the solutions we put in place."

Paradoxically, part of the problem stems from better security at points of sale. Credit cards with chips are virtually impossible to duplicate. So thieves have moved online to make purchases with stolen identities and credit card numbers.

Online shopping is convenient for regular customers and crooks, too. Pascual predicted card-not-present fraud will get worse because criminals are getting better at it.

"Their skill sets are improving and the tools that they're using are much more sophisticated," he said. "They're using things like botnets to complete orders at high speed that can overwhelm a merchant's security defenses."

2. Imposter Scams Surpass Identify Theft

For the first time, the FTC reported, impostor scams passed identity theft in the number of complaints it received last year. The agency said the rise in impostor scam reports is due to an increase in complaints about government impostors.

"Impostor scams come in many varieties, but work the same way: a scammer pretends to be someone trustworthy, such as a government official or computer technician to convince a consumer to send money," the agency said. "Impostor scams also topped the list of complaints from military consumers followed by identity theft complaints."

The FTC said most complaints came from people who said they were defrauded by phone. The consumer protection agency urges consumers to be wary of any caller asking for a wire transfer. The government will not ask a consumer to wire money, the agency said, and it is illegal for telemarketers to ask for payment by wire.

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