Since May 2000, the FBI’s Internet Crime Complaint Center (IC3) has received more than 4 million complaints. Incidences of internet crime are steadily increasing. In 2013, IC3 received 262,813 complaints, with a reported loss amount of $781.8 million. In 2017, IC3 received 301,580 complaints, with a reported losses of $1.4 billion.
Tracking the Trends
IC3 tracks the latest trending scams each year. In 2017, Business Email Compromise (BEC), Ransomware, Tech Support Fraud, and Extortion topped the list. BEC, Confidence/Romance Fraud, and Non-Payment/Non-Delivery schemes had the highest reported losses.
The Targets
Small and mid-size businesses are frequent targets for this crime because:
They tend to pay less attention to information security, controls and risk assessments.
Their systems tend to be more vulnerable than larger entities.
They have resource constraints, including finances and expertise, which can lead to further risks.
The specific person targeted often in the person most likely to be conducting online banking transactions for the entity, such as the chief accounting officer, chief financial officer, treasurer or controller, all of whom are relatively easy to identify online. Computer scams are constantly evolving as scammers become more sophisticated. For example, since their inception, BEC schemes have evolved:
| Year | Target | Action | |
|---|---|---|---|
| 2013 | Fraudsters start hacking the email accounts of CEOs/CFOs | ⟶ | Fraudsters send email from hacked accounts requesting wire payments to fraudulent locations |
| 2014 | Fraudsters hack personal email accounts | ⟶ | Fraudsters send fraudulent requests for payment to vendors identified from personal contact lists |
| 2015 | Fraudsters posing as lawyers or law firms contact victims | ⟶ | Fraudsters instruct victims to make secret or time-sensitive wire transfers |
| 2016 | Fraudsters hack legitimate business email accounts | ⟶ | Fraudsters send requests for Personally Identifiable Information or W-2s for employees |
| 2017 | Fraudsters heavily target the real estate sectors | ⟶ | Fraudsters cause losses to victims during real estate transactions |
The Stats
According to IC3’s 2017 Internet Crime Report, IC3 found the following statistics.
The top three categories of internet crime by victim count were:
- Non-Payment / Non-Delivery 84,079
- Personal Data Breach 30,904
- Phishing/Vishing/Smishing/Pharming 25,344
The top three categories of internet crime by victim loss were:
- BEC / EAC $676,151,185
- Confidence Fraud / Romance $211,382,989
- Non-Payment / Non-Delivery $141,110,441
Being aware of current trends can help to protect you and your business. In the world of constantly evolving scams, awareness gives you a leg up in preventing and detecting the potential gaps in the armor of your internal controls and cyber controls.
