Online fraud complaints in the US could reach a record high of 1 million in 2022
According to the data compiled by Atlas VPN, online fraud complaints in the United States are expected to reach a record 1.11 million in 2022, driven by various factors such as an increase in cyber threats.
The projection made by the Atlas VPN team represents 31.5% growth from the 847,376 complaints registered in 2021. It was calculated by averaging the yearly internet scam complaint growth number from 2017 to 2021.
The losses to internet scams in the US are also expected to rise by almost 52%, from $6.9 billion in 2021 to $10.47 billion in 2022.
The calculations are based on the Internet fraud data numbers provided by the FBI Internet Crime Complaint Center (IC3) in their Internet Crime Report 2021.
Part of the reason why we are still seeing an uptick in online fraud is the role technology plays in our everyday lives. The recent pandemic especially highly impacted our daily habits, teaching us that we can do everything online from working to shopping to going to doctor's appointments, which means that internet fraud will possibly continue to increase.
Looking at the historical data, the number of internet fraud complaints and funds lost to online scams grew yearly. In 2018, complaints increased by 17% from 301,580 to 351,937. Meanwhile, online fraud losses nearly doubled, growing from $1.4 billion to $2.7 billion.
In 2019, the numbers jumped by 33% and 30%, respectively, reaching 467,361 complaints and $3.5 billion in losses. In 2020, internet scam complaints surged once again, this time by 69%, rising to 791,790, while losses increased by a fifth to $4.2 billion. Finally, last year, online fraud complaints saw the slowest growth of 7%, coming to 847,376. However, fraud losses jumped by 64%, climbing to $6.9 billion.
In total, IC3 registered $2.76 million online scam complaints in the United States in the past five years (on average, 552,000 per year), amounting to losses of a whopping $18.7 billion. The cumulative number of complaints is estimated to reach 3.87 million by the end of 2022, while losses — $29.17 billion.
Why online scam complaints and losses are expected to increase
The rise in online fraud is motivated by various factors, but increasing online presence is among the main ones. During the Covid-19 pandemic, people turned to online services as lockdowns confined them. Many businesses, in turn, also moved online. As more and more people started transacting on the internet, cybercriminals saw it as an opportunity to fill their pockets.
Even with the pandemic's peak well past us and with businesses opening up, people's habits have been changed for good. Many people made the work-from-home their status quo, while others found running their errands online more convenient and time-saving.
What is more, the number of internet users is growing every year. According to the data provided by Statista, there were around 4.7 billion internet users in the world last year. By the end of 2022, internet users are expected to reach 5 billion.
At the same time, cyber threats are constantly evolving, and fraudsters are getting more sophisticated with their attacks. While Nigerian prince scams are still going strong, cybercriminals are also utilizing more effective methods. For instance, they often spoof popular brand names and websites in hopes users will not notice that the email they received or the website they visited is fraudulent.
In fact, phishing, vishing, smishing, and farming were the most common types of cybercrime over the past five years. Overall, 731,739 cases of such crime were reported from 2017 to 2021. In H1 2022, Americans lost 3.56 billion to online fraud.
Phishing, vishing, smishing, and farming are all types of social engineering attacks where criminals use manipulation tactics to trick potential victims into performing certain actions or revealing sensitive information. Phishing attacks use emails as contact methods, vishing involves phone calls, while smishing uses text messages.
Pharming attacks, on the other hand, send internet users to a fake website that looks like a real thing. There they attempt to trick the users into inputting personal details or infect them with malware. Based on the past trends, it is likely that social engineering attacks will dominate this year as well.
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