Covid scams cost Americans nearly $500 million

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According to the Federal Trade Commission, Americans have lost nearly $ 500 million to Covid-related scams since the pandemic began.

And the agency warns that scammers will likely try to take advantage of families expecting monthly payments from the child discount starting Thursday.

Around 327,000 people filed a fraud report with the federal agency between January 1, 2020 and July 8 of this year, the data shows.

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According to the commission, the victims lost a total of $ 488 million. The typical person has lost $ 366.

While fewer seniors were cheated on compared to other age groups, their losses are nearly three times higher – the typical person over 80 lost $ 1,000 to cheating.

Criminals have used several avenues to steal money from unsuspecting Americans, including fraud related to online shopping, travel, and government stimulus funds during the pandemic.

“While people fear for their health and finances, scammers have a big day,” Lucy Baker, a consumer advocate for US PIRG, told CNBC.

The actual amount of fraud can be much higher as the data only reflects scams that the public reports to the FTC.

Shopping online accounted for the most reported scams: 53,000 complaints, or about 16% of the total.

Americans increased their online orders during the pandemic as they spent more time indoors. But many fell victim to “opportunistic websites” claiming to sell popular items – everything from hand sanitizer to gloves, electronics, clothing, and even puppies, according to the FTC. Customers order the item, but then never receive it.

When government money is in the news, we know scammers are about to release their default playbook.

Lisa Lake

Consumer education specialist at the FTC

The victims lost the largest amount of money ($ 77 million) to vacation and travel fraud, FTC officials say. Most of the fraud cases relate to refunds and cancellations, the agency said.

Travel has recovered with the rise in Covid vaccinations – and scammers have responded by creating fake booking pages for airline tickets or customer service numbers, according to the Better Business Bureau.

In some cases, victims searched online for cheap flights and found seemingly great deals on major airlines, according to the bureau. Travelers should be careful and double-check a website URL or phone number before providing credit card information, suggests the bureau.

Incentive and child tax credit

Fraudsters have also posed as government officials or anyone else claiming to be able to provide ailing households with access to hundreds of billions of dollars in federal aid, such as stimulus checks issued during the pandemic.

The FTC warns families that criminals may attempt to exploit families who expect to receive up to $ 300 per month per child from a child tax credit advance. The IRS will send payments starting Thursday.

“When government money is in the news, we know scammers are about to release their default playbook,” Lisa Lake, a consumer education specialist with the FTC, wrote last month.

“They can call you, email you, text you, or send you a DM,” she said. “They will say that they can help you get your payments sooner (they can’t), get you more money (well no), or tell you other lies (sure).”

Only the IRS will send these payments, so anyone trying to “help” you get a child tax credit is a criminal, Lake said. The government will also never randomly call, text, email, or send a direct message asking for money or information like social security, bank account, or debit and credit card numbers, she said.

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