According to a new report by the FBI, virtual currencies are not that much of a threat in the world of online and offline criminality. More specifically, virtual currencies attributed to $28.3m worth of crime-related financial damages throughout all of 2016. This number is a lot lower compared to what most people had anticipated at this time. It is evident some types of fraud are still far more popular than others, which will not change anytime soon.
6. Advance Fee Fraud
One of the biggest causes of fraud throughout 2016 is known as advance fee fraud. This type of con is rather simple to explain, as criminals trick victims into making upfront payments for goods or services. In the end, these business dealings will not materialize by any means. Victims pay the money, the seller magically “disappears” and the money is never seen or heard from again. People who have ever received one of the infamous “Nigerian Prince” emails will know this scheme all too well. A total of $60.484m was lost to advance fee fraud in 2016.
5. Corporate Data Breach
As we recently touched upon in a different article, the number of data breaches has increased throughout 2016. It is not entirely surprising to see companies lose around $95.869m in financial losses as a result of corporate data breaches, according to the FBI report. That is quite a significant amount of money, considering most corporate data breaches can be prevented by allocating a budget smaller in value compared to the amount of money lost to criminals.
4. Investment Fraud
No one should be surprised to learn investment fraud is still a big problem in 2016. In most cases, people receive spam emails claiming a new type of stock will hit the market or go up in price very soon. The criminals then trick recipients into buying the stock, after which the criminals crash the market. A total of $123.4m has been lost due to investment fraud in 2016, which is a stellar amount of money. Unfortunately, it is only the fourth-most common type of crime right now.
3. Non-Payment and Non-Delivery
Life has become a lot more difficult for online merchants over the past few years. They often suffer from two different types of crime, both of which can bankrupt business rather quickly. The non-payment scam is a result of people placing orders with stolen payment information. After the item ships, the original card holder often demands a refund. In some cases, legitimate buyers as for a refund too after receiving the item, as they claim there was no item delivery whatsoever. In both cases, financial losses all up quickly. Throughout 2016, retailers lost $138.228m due to these types of crime.
2. Romance Fraud
Numerous stories circulate on the Internet regarding men – or women – conned by someone they met online. In virtually all cases, these strangers on the internet form a romantic relationship with the victim in an effort to obtain money from them. A lot of people fall for these scams, which is not surprising in our society today. Throughout 2016, over $219.8m in financial losses were recorded, according to the FBI report. That is a very saddening amount, to say the least.
1. Business Email Compromise
People who have been paying attention to cybercrime trends will have heard of the business email compromise problem. Criminals impersonate executives of a particular company in the hopes of getting staffers to make foreign wire transfers with company funds. In most cases, these scams are rather successful, especially when smaller amounts of funds are involved. In 2016, the FBI recorded over $360.5m in losses due to business email compromise.
Note from the author: Virtual currencies attributed to $28.3m in cybercrime losses throughout 2016. A very small number, which is not entirely surprising.
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