Millennials fall for financial scams more than any other age group

Millennials are more prone to lose money in financial scams than their elders, according to newly released government data.

The Federal Trade Commission reported last week in its annual data summary of consumer complaints that 40 percent of Americans in their 20s who reported fraud in 2017 also said they lost money. By contrast, only 18 percent of victims aged 70 or older reported losing money.

The dollar value associated with the fraud complaints were much higher for those aged 70 and older, however. Those in their 20s reported a median loss of $400. That's compared to $621 for those in their 70s and $1,092 for those 80 and up.

In all, the data collected by the federal watchdog group includes 2.7 million complaints, down slightly from total complaints in 2016. Dollar losses reported from fraud, however, increased $63 million from last year to almost $905 million.

"While we received fewer overall complaints in 2017, consumers reported losing more money to fraud than they did the year before," acting director of the FTC's Bureau of Consumer Protection Tom Pahl said in a statement published with the data. "This underscores the importance of the FTC's work in educating consumers and cracking down on the scammers who try to take their money."

Financial schemes and scams were most frequently reported to have stemmed from a phone call.
sturti | Getty Images
Financial schemes and scams were most frequently reported to have stemmed from a phone call.

The most popular scams

Phony debt collections, identity theft and impostor scams, in which someone pretends to be a trusted person such as a government worker, a tech support agent or a family member in an emergency, were the schemes most frequently reported.

Impostor scams proved notably widespread and dangerous: One out of every five people who reported a complaint was caught up in one, and those who were fooled lost a median of $500 each.

Still, as successful as these scams are, others are even more lucrative. Travel, vacation and timeshare-plan schemes topped the list of fraud categories that accounted for the highest median loss, at $1,710 each.

Mortgage foreclosure relief and debt management scams also cost people a lot of money, with an associated median loss of $1,200 each. Business and job opportunity schemes rounded out the top three with a $1,063 median loss.

Contact by telephone was the method of communication reported in 70 percent of fraud cases recorded by the FTC. Wire transfers continued to be the most-frequently reported method of payment in fraud cases, accounting for $333 million in losses.

Video by Zack Guzman

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