FBI: Investment Fraud Now Leads All Cyber Crime in Losses Caused, but BEC and Ransomware Remain Strong

by | Mar 28, 2023

The Internet Crime Complaint Center (IC3) publishes cyber crime statistics each year, and in recent years business email compromise (BEC) has been king of the hill in terms of theft amounts. While BEC remains a strong runner-up, a new type of crime has roared to the top in just one year: investment scams that involve gaining the confidence of an online target, most commonly to put money into some sort of cryptocurrency fraud.

These “pig butchering” schemes, as the FBI calls them, overlap to some degree with romance scams. They have not only received their own special classification for the first time, due to the change in focus to simply promising amazing returns rather than using dating as a pretext, but have also cost victims at least $3.3 billion in the past year.

Investment and call center fraud are the hottest recent areas of cyber crime

While total losses of “only” $34 million might make it seem like ransomware is on the wane, the FBI and IC3 advise continued vigilance in this area of cyber crime as these particular numbers are usually among the most underreported. The players that remain in the ransomware game are also increasingly threatening to leak stolen documents as an extortion tactic, and they are also focusing in on certain critical infrastructure sectors thought to be especially vulnerable to attacks (such as hospitals and organizations that use industrial control systems).

BEC is not going away either, with $2.7 billion in losses in 2022 (an increase from the previous year). New AI tools that enable easier writing of emails/messages and faking of executive voices is a particular concern here. However, the FBI is also getting better at freezing and recovering funds, clawing back about $433 million of that amount.

“Pig butchering” investment schemes are easily the hottest trend in cyber crime, however, at least according to this report. They account for nearly a third of the $10.2 billion lost in 2022, and almost equal the total increase in losses from the prior year (a major jump from $6.9 billion). These schemes usually involve someone gradually gaining the confidence of a target, eventually massaging them into investing into some sort of scam under the promises of major returns; over half of the time this is a crypto scheme of some sort.

Complaints down, but losses up

Overall, cyber crime complaint numbers are down (for the first time in a long time). However, total loss amounts are way up. This could mean that attackers are more judicious in their selection of methods (or targets), and are quicker to take up trends that show consistent success. In other words, cyber crime efficiency seems to be improving, which is not good news for anyone.

And while seniors (age 60 and older) continue to experience the highest rate of losses due to online scams, criminals are showing much more of an interest in the age 30 to 49 demographic that is likely to have money on hand and be interested in crypto investment. However, one other area of cyber crime that experienced a substantial surge in 2022 is call center fraud, which racked up over $1 billion in theft, and this type of crime still very much focuses on seniors.

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