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Cost Spirals for US Victims of Cyberfraud

Joseph Menn, Financial Times
Monday, 15 Mar 2010 | 10:16 AM ET

Online fraud cases in the US cost victims more than twice as much in 2009 as they did the previous year, underscoring fears that internet crime is growing out of control.

The Federal Bureau of Investigation’s Internet Crime Complaint Center, a web portal the US law enforcement agency operates in conjunction with the National White Collar Crime Center, last year referred cases involving total losses of $560m (€407m, £368m) for investigation by various authorities – up from $265m in 2008 and $183m five years ago.

The FBI gave no indication of how much money had been recovered, but US Federal Trade Commission officials have said that a large majority of serious internet crime is committed from overseas, especially eastern Europe, where enforcement is difficult.

Donald Brackman, white collar crime centre director, said cybercriminals were “developing increasingly sophisticated means of defrauding unsuspecting consumers. Internet crime is evolving in ways we couldn’t have imagined just five years ago”.

The FBI said the portal referred twice as many complaints for enforcement in 2009, a record 127,000, as it did in 2008. Non-delivery of promised goods or services triggered the most referrals for enforcement, followed by identity theft and credit or debit card fraud.

The FBI figures do not include complaints to local police or other agencies.

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