Australian Institute of Criminology

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Findings and discussion

As in previous years, scam invitations were received by a large proportion of the survey respondents, with 94.5 percent of participants reported receiving a scam invitation in the 12 months prior to the survey. The most commonly received scams were lottery scams, computer support centre scams and phishing scams.

Consistent with the 2010 and 2011 ACFT survey findings (Hutchings & Lindley 2012), dating scams resulted in the greatest level of victimisation, although they were the least prevalent scam type. Victims of dating scams reported losses exceeding $200,000. This finding remains consistent with scam complaints made to the ACCC (2012a). In 2012, the ACCC issued voluntary best practice guidelines for dating sites to prevent the proliferation of romance scams. These guidelines include:

  • displaying simple and direct warning messages in appropriate locations;
  • implementing a vetting and checking system to identify advertisements that have been created by scammers; and
  • providing a mechanism whereby users can report scams (ACCC 2012b).

Dating sites that comply with these guidelines and provide services that are relatively free from scammers may enjoy an enhanced reputation and users may have an increased confidence in the site. Future scam surveys will assist in determining what effects these efforts to raise awareness of dating and romance scams (as well as disrupting scam activities) will have on rates of reported victimisation.

Twenty-two percent of respondents disclosed that they had responded to a scam invitation in the 12 months prior to the survey. Responding could mean sending money or personal details or asking for more information. Almost seven percent stated that they sent personal information as a result of a scam invitation, 2.9 percent sent money and five percent of the sample disclosed that they had sent personal details and experienced a financial loss. While the loss of money can be damaging, perhaps future campaigns need to highlight that in the 21st century, personal information can be a type of currency itself. With the rise of online transactions and the importance of identity-related information in economic commerce, identity is now a legal concept as well as a commodity (UNODC 2011).

As shown in Figure 4, the median financial loss reported each year has been steadily declining since 2010. The median financial loss of $500 reported in 2012 is the lowest reported in the AIC’s annual consumer fraud survey thus far and is one-third of the median reported loss in 2008.

Figure 4 Median reported financial loss by year ($)

Median reported financial loss by year

Source: ACFT Consumer Fraud Surveys 2007, 2008, 2009, 2010, 2011 and 2012 [AIC data files]

The ACCC (2012a) and Hutchings and Lindley (2012) noted that between 2010 and 2011, there had been an increase in unsolicited telephone calls as the preferred scam delivery method. While overall, email remained the most common method by which scams were delivered, the findings from the current ACFT survey continue to show high levels of scams disseminated by telephone and SMS. The main difference with these two scam delivery methods is that, while many respondents reported receiving scam invitations by phone, most reported receiving just one to five scam invitations this way. By contrast, more participants reported receiving multiple scam invitations by email. Of those who reported receiving scam invitations by email, over one-quarter (26.7%) had received more than 50 solicitations this way.

Included in the 2012 survey was a new scam category ‘computer support scams’. A computer support scam was defined as a person representing themselves as someone from a computer support centre. This category was included in the 2012 survey as, in the ‘other’ category in the 2011 ACFT survey there was a high proportion (over 150 respondents) who indicated they had received a scam that was purportedly from a computer software company or a computer service centre area. The findings showed that the computer support centre scam was one of the most common type of scams received by respondents (53.2% of respondents indicated they had received this type of scam invitation), second only to lottery scams. No doubt as a result of the prevalence of this type of scam, respondents indicated that the computer support centre scam was in the top three scam types likely to be considered a crime by participants. This type of scam demonstrates the adaptability of scammers and while recent scams have relied on new and emerging communication technologies (such as SMS ringtone scams or premium text messages), scams that rely on older technology (such as telephones) remain a concern. This is especially so with the widespread use of Voice over Internet Protocols (VOIP), which allows scammers to make telephone calls very cheaply.

It has previously been noted that the rate of reporting scams to law enforcement and regulatory agencies is generally quite low (Hutchings & Lindley 2012). This continues to be evident in the 2012 findings, with only 17.3 percent of victims reporting the scam to police and 15.2 percent reporting the scam to the ACCC. It was concerning to note that the most common reason for not reporting a scam invitation in the survey was that respondents were unsure of which agency to contact. A low reporting rate affects resources that may be allocated to combat scams and it also impacts the overall knowledge and understanding that agencies have to develop awareness and education campaigns. For example, it has been consistently demonstrated in this survey over the years that it is not the most commonly received scams, such as lottery scams, that cause the most victimisation. While reporting rates are low, when respondents did report a scam invitation, the most frequent reasons for doing so was to prevent others from becoming a victim of the scam and because they knew it was the right thing to do.

Online trading and auction sites

As scams and frauds that take place on online trading and auction sites was the focus of the 2013 National Consumer Fraud week, survey results relating to this scam type were examined in detail. Interestingly, scams involving goods offered for sale by the intended victim were reportedly more common than scams involving the purchase of goods, such as for non-existent, stolen or counterfeit goods, the non-delivery of items, or the misrepresentation of products. Scammers typically offered sellers a larger amount for the item than was advertised and requested the seller to cover the costs associated with an overseas agent or courier service, promising that they would be reimbursed. It appears that the ‘agent’ or ‘courier service’ were fronts for the receipt of the scammed funds and scammers also commonly faked remittance notices to indicate that a payment had been made when it had not. Vehicles, such as cars, were common targets for scammers, presumably due to their high value, as well as the costs associated with shipping overseas.

None of the respondents reported shill bidding, where the price is artificially inflated due to false bids, or fee stacking, whereby additional fees are added on after the auction (Yar 2006).

It was noted that one online trading site was overrepresented in respondents’ accounts of scam attempts and actual victimisation. This site accounted for 52.2 percent of vehicle sale scams and 84 percent of scams involving the sale of other items, where the site was known. The website in question was examined and it was noted that this overrepresentation was despite the provision of warning notices identifying the common methodologies used by scammers (as of April 2013). One reason for this overrepresentation may be because unlike another popular trading site, payment methods are not offered by the website, which would mean that the transaction would be kept onsite and would be harder to falsify.

Suggestions for future campaigns

Suggested themes for future education and awareness campaigns include a focus on:

  • developing a greater awareness about the potential harms associated with disclosing personal details. The disclosure of personal details can lead to further victimisation such as identity crimes and financial losses. Future campaigns could focus on the value of personal information and how those details may be used by scammers;
  • changing the perception of victims. Survey findings indicate that respondents may hold negative views about people who fall victim to scams. This type of belief undermines people wanting to report victimisation and scam invitations. Campaigns could highlight the sophistication of some scams and the damage they cause, including the emotional impacts on victims and their families; and
  • new technologies that scammers may focus on, yet still maintaining an awareness of how older scams or older technologies (such as landline telephones) can be used by scammers.