Rise in Government Impersonation Scams Costing Consumers Millions, FTC Reports

Federal Trade Commission (FTC)

WASHINGTON, D.C. — The Federal Trade Commission (FTC) has released alarming new data showing a significant increase in losses due to government impersonation scams. In 2023, consumers reported losing $76 million to these scams through cash payments, nearly doubling the $40 million lost in 2022.

The trend shows no signs of slowing down. In the first quarter of 2024 alone, consumers reported losing $20 million when paying cash to scammers posing as government officials. This sharp rise has prompted federal agencies to intensify their efforts to raise awareness and combat the issue.

“The impact of government impersonation scams is massive across the board, costing consumers millions,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “For consumers who are convinced by scammers to pay cash, the harms are amplified even further. We’re glad to join with other agencies across the federal government to raise awareness of this issue and work to put a stop to it.”

Government impersonation scams typically involve fraudsters pretending to be officials from agencies such as the IRS, Social Security Administration, or local law enforcement. They often claim there is an urgent issue, requiring immediate payment to avoid serious consequences. These tactics create a sense of panic, causing victims to act without questioning the legitimacy of the request.

One of the most concerning aspects of these scams is the amount of money involved. In the first three months of 2024, the median loss for consumers paying cash to these scammers was a staggering $14,740, far higher than losses involving other payment methods. Victims have reported both mailing cash and handing it directly to drivers sent by the scammers.

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Federal agencies including the Department of Justice, FBI, Postal Inspection Service, IRS, and several others are collaborating to educate the public and prevent further losses. A critical message they want to convey is that legitimate government agencies will never call, email, text, or message you on social media to ask for money or personal information. They will also never demand a payment.

Despite the efforts to raise awareness, losses to government impersonation scams across all payment methods reached $618 million in 2023. This marks an increase from $497 million in 2022 and $428 million in 2021.

In response to this growing problem, the FTC has implemented a new rule providing the agency with stronger tools to deter and combat scammers. This rule enables the FTC to file federal court cases to recover money for affected consumers and impose civil penalties on violators.

Consumers who suspect they are being targeted by a government impersonation scam should report it to the FTC at ReportFraud.ftc.gov. By reporting these incidents, consumers help authorities track and respond to these fraudulent activities more effectively.

The rising trend in these scams highlights a broader issue of trust and security in interactions with supposed authority figures. While technology makes it easier for scammers to reach potential victims, it also provides tools for education and prevention. Public awareness and vigilance remain key defenses against these sophisticated scams.

As federal agencies continue their efforts to protect consumers, individuals must stay informed and skeptical of any unsolicited communications demanding money or personal information. The collaboration between agencies and the implementation of stronger protective measures aim to reduce the impact of these scams and safeguard consumers’ hard-earned money.

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