Who are the perpetrators of scams?

Tech-based scams are mainly perpetrated by foreign crime gangs. According to British government research, most fraud has an international component, and organized crime plays a significant role. “There is evidence showing direct links between fraud and other organized crime, such as modern slavery, human trafficking, and drugs.” The proceeds from this criminal enterprise have also been used to fund terrorist activity, according to the Royal United Services Institute.

Some fraud is being conducted by state-backed hackers. The FBI has seen North Korea’s state-backed hackers attempt to acquire cryptocurrency through fraud and cyber crime. North Korean hackers—including from the government-run Lazarus Group—are sharing money-laundering and underground banking networks with fraudsters and drug traffickers in Southeast Asia, according to a United Nations report published in January 2024.

According to various law enforcement agencies, scammers are located in countries such as:

• India. Call center and tech support scams “primarily emanate from call centers in South Asia, mainly India,” according to the FBI.

• West Africa, especially Nigeria. Interpol in 2023 said that the Nigerian Black Axe crime syndicate and similar groups are responsible for the majority of the world’s cyber-enabled financial fraud. Criminals engaged in the growing wave of “sextortion” scams that target teens are “usually located outside the United States and primarily in West African countries such as Nigeria and Ivory Coast or Southeast Asian countries such as the Philippines,” according to the FBI.

• Southeast Asia. According to the UN High Commissioner for Human Rights, criminal gangs have forced hundreds of thousands of people in Southeast Asia into participating in unlawful online scams. At least 120,000 people in Myanmar and roughly 100,000 in Cambodia “may be held in situations where they are forced to carry out online scams.”  Laos, the Philippines, Malaysia, and Thailand were also cited among the main countries of destination or transit for tens of thousands of human trafficking victims involved in scams.

• China. Many of the gangs in the lawless corners of Southeast Asia are controlled by Chinese crime bosses. According to the Myanmar country director for the United States Institute of Peace, an independent research organization founded by the U.S. Congress, “These are largely Chinese crime groups which China, for years, did very little to check.”

• Russia. In April 2024, the US Department of Justice seized four domains used by the administrators and customers of a domain spoofing service operated through the Lab-host.ru domain (LabHost), which resolves to a Russian internet infrastructure company. Criminals used LabHost to create and manage spoofed websites designed to look like the legitimate websites of businesses such as Amazon, Netflix, Wells Fargo, Bank of America, and Chase Bank. LabHost has been used to create over 40,000 spoofed websites. The scheme originating from Russia “enabled criminals to steal from over a million victims in the United States and around the world,” said Attorney General Garland.

• Latin America. According to Interpol, there is emerging evidence that Latin-American crime syndicates such as Commando Vermelho, Primeiro Comando da Capital (PCC) and Cartel Jalisco New Generation (CJNG) are also involved in the commission of financial fraud. The US Treasury Department says: “Mexico-based transnational criminal organizations (TCOs) such as the Jalisco New Generation Cartel (CJNG) are increasingly targeting U.S. owners of timeshares in Mexico through complex and often years-long telemarketing, impersonation, and advance fee schemes. They use the illicit proceeds to diversify their revenue streams and finance other criminal activities, including the manufacturing and trafficking of illicit fentanyl and other synthetic drugs into the United States.” The New York Times recently cited US officials as saying the Jalisco New Generation cartel has netted hundreds of millions of dollars over the past decade from dozens of call centers that target American and Canadian timeshare owners.

• Dominican Republic. In April 2024, the Justice Department charged 16 individuals in connection with a sprawling “grandparent scam” to defraud elderly Americans out of millions of dollars. The scam was operated from call centers in the Dominican Republic.

• Jamaica. The FBI participated in closing down several multi-million-dollar fraud rings in Jamaica last year, but many more remain in operation.

• Romania. In 2021, DOJ indicted members of a Romanian crime ring that allegedly created and used fictitious websites, email addresses and other forms of communication designed to convince their victims that the advertisements were genuine and that they were communicating with legitimate business representatives, when in fact, they were speaking with a member of the conspiracy.

• Other countries: In 2018 and 2019, the US Department of Justice announced arrests in Nigeria, Turkey, Ghana, France, Italy, Japan, Kenya, Malaysia, Canada, Mauritius, Poland, the United Kingdom (UK), and the United States.

In June 2023 Interpol issued a global warning on human trafficking-fueled fraud, saying: Scams are now a “global human trafficking crisis.” Interpol said that human trafficking to fuel scam operations was especially prevalent in Southeast Asia, and is now being seen in West Africa. The Organization issued an Orange notice--a global warning regarding a serious and imminent threat to public safety.

In March 2024, Interpol Secretary-General Jürgen Stock said human trafficking-fueled fraud is exploding in Southeast Asia with organized crime rings raking in close to $3 trillion in illicit revenue annually, with some individual groups making as much as $50 billion per year. “Driven by online anonymity, inspired by new business models and accelerated by COVID,” Stock said, “these organized crime groups are now working at a scale that was unimaginable a decade ago.” "What began as a regional crime threat in Southeast Asia has become a global human trafficking crisis, with millions of victims, both in the cyber scam centres and as targets."

What are the most serious scams in the United States?

All scams are serious, but the FBI’s annual report highlights four types of fraud that stand out from the rest. These four types of cyber crimes account for 77 percent of the reported losses in the FBI’s report.

• Investment scams, especially crypto-investment scams. Investment schemes have the highest reported losses, and are experiencing unprecedented increases in the number of victims and the dollar losses to these investors.

• Business Email Compromise. The second-costliest type of crime reported to the FBI. A criminal conducts unauthorized transfers of funds by compromising legitimate business email accounts through social engineering or computer intrusion.

• Tech support/call center scams. These schemes overwhelmingly target the elderly, with devastating effects. Among those over the age of 60, tech support/call center scams claim far more victims than other types of scams, and reported losses have increased 15-fold since 2018. An FBI Public Service Announcement warns about a variant of the tech support scam: “Phantom Hacker” Scams Target Senior Citizens and Result in Victims Losing their Life Savings”.

• Confidence/Romance. An individual believes they are in a relationship (family, friendly, or romantic) and are tricked into sending money, personal and financial information, or items of value to the perpetrator or to launder money or items to assist the perpetrator. Often combined with investment scams.

Below is an excellent visualization of the most significant scams affecting the older population. The most reported scams show higher on the chart, and those with the most losses are toward the right. The size of each bubble represents the average loss per victim.

Source: Visualization of 2022 FBI data by Comparitech. https://www.comparitech.com/identity-theft-protection/senior-scam-statistics/