When it comes to fraud, the stereotype of the bumbling, overly trusting senior who hands their savings over to a Nigerian prince is just that: a stereotype.
Millennials are a generation of digital natives who grew up with computers, smart devices and the internet in their homes and schools. But that doesn’t mean younger millennials are any smarter when it comes to avoiding web or phone scams. In fact, 20-somethings are nearly three times as likely to fall victim to a scam as seniors, according to a 2018 report by the Federal Trade Commission.
How is this possible? Younger adults have a few habits that make them more susceptible to fraud, according to Frank Abagnale Jr., a con-man-turned-security-consultant who is the subject of Steven Spielberg’s 2002 box office hit “Catch Me If You Can” and author of the new book “Scam Me If You Can.”
A Generation Of Oversharers
“In doing the five years of research for this book, I was shocked to find that actually, millennials get scammed more often than seniors,” Abagnale said.
Last year, the FTC collected more than 1.4 million fraud reports, and people reportedly lost money in 25% of those cases ― an increase of 38% over 2017.
Though it’s tough for some to believe, younger people reported losing money more often than older adults, a trend that the FTC has been seeing for several years. In 2018, 43% of people in their 20s reported a loss to fraud, while only 15% of people in their 70s did.
The reason it happens to young people more often? A lot of it has to do with their willingness to share personal details online.
According to Abagnale, scammers have become so much more sophisticated in the time since he was conning when all he had at his disposal was a telephone. Today, they have so much technology and data to work with that it’s easy to make people believe they’re the bank, or the Social Security Administration or the U.S. Treasury. “And that comes from social media,” he said.
For example, seemingly innocent Facebook quizzes are an easy way to get users to share personal details publicly. And millennials are the most likely to share content on Facebook in general, according to data collected by Business Insider.
“If you tell me on Facebook where you were born and your date of birth, that’s 98% of me stealing your identity,” said Abagnale, who opts not to have a Facebook profile at all. “That’s really all I need to know: those two pieces of information.”
Abagnale said the other problem is that young adults are simply too trusting. “They’re very gullible and very naive,” he said. For example, a person might get a pop-up or an email that’s supposedly from Microsoft, warning that there is suspected malware on the device and to call an 800 number to resolve the issue. Once the person calls, they might be instructed to hand over remote access to their computer to fix the nonexistent problem, or supply their credit card information over the phone. That’s a type of scam that younger adults fall for regularly, he said.
For the most part, young people ― and people of all ages, really ― are also honest, he said. “And because they’re honest, they don’t have a deceptive mind.” While this a refreshingly positive trait in most cases, it means targets of fraud aren’t employing enough skepticism and are handing over their personal information too willingly to the few who aren’t so scrupulous.
According to the FTC, the top three types of fraud were imposter scams, debt collection and identity theft. The most common way scammers received their money was by wire transfer, though the agency also saw a surge of payments by gift and reloadable cards.
Signs Of A Scam
In addition to working as a fraud consultant and authoring several books about fraud, Abagnale serves as the Fraud Watch Network Ambassador for AARP and co-hosts a weekly podcast called “The Perfect Scam.” “The overall thing that I learned … is that anybody can be scammed,” Abagnale said. “It doesn’t matter how sophisticated you are or how intelligent you are.”
When it comes to avoiding scams and fraud, it’s all about education and knowing what to look for. Though there are myriad scams operating today, Abagnale says there are two basic red flags to know.
“If you recognize these flags, you’ll never be scammed,” he said.
1. You need to send money right away.
The first major red flag of a scam is that you’ll be asked to send money, and it’ll be an urgent request.
For example, you might be asked to provide a credit card number, or share your bank account information in order to wire money, or go buy gift cards and provide the serial numbers. Any time you’re pressured to provide money under the threat of legal action, having a lien placed against your home or any other serious consequence, take a step back and consider whether the scenario really makes sense.
2. You’re asked to supply personal information that the person should already have.
Another sign that you’re the target of a scam is being asked for sensitive personal information. For instance, you might be asked to provide the security number on the back of your credit card or the last four digits of your Social Security number as a means of verifying your identity.
“That’s the red flag: You’re asking me for personal information. But I didn’t call you, you called me. I have no idea who you are,” Abagnale said.
Bottom line: Before you give out any information or pay any money to someone who contacted you, be absolutely sure of who’s on the other end of the line. The best way to do this is to hang up the phone and call back or call the organization directly if you’re contacted via the web or email.
If you’re contacted by someone claiming to be law enforcement, for example, hang up and look up the number of the agency yourself. If it’s your bank that’s supposedly in contact with you, call the number on the back of your card and explain what’s going on.
“I tell people every day that you can’t rely on the police, you can’t rely on the government, you can’t rely on your bank to protect you. You have to be a smarter consumer today,” Abagnale said. “And especially if you’re a young person, you have to use a little common sense.”