Fraud is a growing concern and fear for the modern American consumer. We are constantly bombarded with reports and stories from countless victims of fraud. But is this an actual issue we should be worried about or just another over paranoia of our society? Judging from the results of a recent survey by the Federal Trade Commission (FTC), there is no over exaggeration. Twenty five million American citizens, or 11.2 percent of the adult population, fell victim to fraud in a one year period. Surprisingly the report states that minorities are more likely to be susceptible to consumer fraud. American Indians and Alaska Natives had the highest fraud victim rate at thirty four percent. Seventeen percent of African Americans and fourteen percent of Hispanics reported one or more counts of fraud. Leaving the nations majority, Non-Hispanic whites, only reporting six percent. Consumers with higher debts are also more likely to be victims of fraud.
The (FTC) survey showed that three of the top four categories of fraud related to credit. This included advance-fee loan scams that claim victims trying to get out of debt. These scams require advance fees for loans or credit cards to be delivered after the fee is processed. Soon after getting the consumers payment and information the fraudulent company seems to vanish, leaving the customer even more in debt then before. Advance-fee scams are the most frequently reported type of consumer fraud, claiming four and a half million victims in the United States on a yearly average.
The second highest victim totals came from club membership buyers or bills for unordered publications. This is where consumers are unaware they are being billed for memberships they did not authorize and publications they did not sign up for. This happened to a reportedly four million people in a one year period.
Credit card insurance operations claimed over three million victims to fraud, making it the third highest fraud scam. This is where consumers are persuaded to purchase credit card insurance after being told that they will face highly significant charges if their card is illegally used. Federal law mandates consumer liability in case of credit fraud to fifty dollars, making the insurance purchases totally unnecessary and ill-advised.
Lastly, two million consumers were reportedly victimized by credit repair scams. In these cases fraudulent institutions and companies promised the consumers that they had the ability to remove negative information from credit reports. If this were true, these companies would have the power to remove truthful credit information and or establish a new credit report for the consumer. Their promises are totally bogus, they do not have the capabilities to erase and change parts of anyone’s credit report.
The survey reports that most of consumers learn of the companies offering false deals through news ads, internet and posters. These methods contributed to thirty three percent of overall victims. Telemarketing was the first method of contact in seventeen percent of consumer fraud advertisement tactics. Fourteen percent of reports were from email and internet, while television and radio claimed a little over ten percent of the victims.
As far as sex and age demographics, women and younger consumers between the age group of 25-44 are most susceptible to be taken as victims. Seventy four percent of females complained of fraud according to the survey. Meanwhile, males only had a sixty plus percentage of fraud complaints. Younger consumers had over a seventy percent complaint statistic where Americans over the age of 55 had a complaint percentage in the low fifties.
In addition to the four fraud categories, almost fourteen million consumers were victims to illegal telephone slamming. These are cases where the consumer is unlawfully billed for long distance and other charges that they are not responsible for.
Taking all of these statistics into mind, all consumers should be cautious with financial matters. Be sure to research all companies and decisions before taking any actions. If you have any questions about a institutions legitimacy, have complaints, or just simply need more information on this consumer fraud visit the Federal Trade Commission web sire at http://www.ftc.gov or call 1-877-382-4357.
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