A growing gray market for scammers? Data brokers and elder fraud in the US

Older Americans have traditionally been less adept at handling new technologies than their juniors—this isn’t likely to change any time soon. The only things that will change are what those technologies are (future generations will look at the smartphone like we look at the telegraph) and who those older people are (hint: they’re the ones concerned about their elders now).

Criminals have known this all along, and some of them see little more than profit opportunities when they look at people over 60 years old. Scammers and other fraudsters are leveraging the tools available to them to reach more vulnerable marks, to target them more effectively, and to fleece them of more of their hard-earned savings.

Among these criminals’ favorite tools are data brokers. Whether the people search sites that operate out in the open or the other, more furtive and insidious, data brokers that prefer to stay in the shadows, data brokers are a gold mine of personal data. Criminals can and do use such information to improve their schemes. 

Based on their analysis of the FBI’s IC3 reports for 2019–23, Incogni’s researchers identified crimes associated with data availability, specifically instances of fraud involving victims over the age of 60 that may be facilitated or exacerbated by the availability of personal information online. Such crimes were responsible for the vast majority of losses reported, suggesting that data accessibility plays an important role.

Key insights

• In 2023, US residents over the age of 60 lost a total of $3.4B to fraudsters and other criminals, which is 10.6% higher than the total losses for 2022.
• The vast majority (87%) of these losses were connected to crimes facilitated by access to victims’ personal information.
• 53% of crimes reported are potentially enabled by access to victims’ personal data.
• Tech support scams, a data-enabled crime, affected 17,700 elders in 2023, contributing to the loss of $589.8M. 
• The average loss per victim was highest in Hawaii at $61,734, followed by the District of Columbia with an average loss of $57,544, and California with $55,346. 
• Investment-scam losses peaked in 2023 at $1.24B, averaging $192,900 per complaint.
• Researchers found that over 7,300 people over 60 years old were affected by a personal data breach in 2023.

Damages suffered continue to rise as the numbers of complaints reverse course

Last year, somewhat surprisingly, saw decreasing numbers of complaints paired with skyrocketing financial losses. This year, examining the FBI’s 2023 data, our researchers found that although losses have continued to increase, they’re doing so less sharply than across previous years. The number of complaints, though, appears to have bucked its previous, three-year downward trend, increasing year-on-year for the first time since 2020. 

In 2023, there were a total of 101,068 reports filed by people over 60 years old, with associated losses totaling $3.4B. This is 14.5% more than the 88,300 reports that were filed in 2022, and an increase of 10.6% in the total amount lost (up from $3.1B in 2022).

A total of 455,000 reports were filed between 2019 and 2023. The losses reported by seniors during this period totalled $10B. Comparing figures from 2019 with those from 2023, we see the number of reports increasing by 48.6%, while the losses associated with these complaints increased by 310%. 

In 2023, the average amount lost per victim was $33,900. This is slightly (3.38%) lower than the  $35,100 in damages associated with the average complaint in 2022.

In 2023, people over 60 in American Samoa (accounting for 3 complaints and $297,700 in damages) were the most affected on a per-complaint basis, losing around $99,220 per complaint—an increase of over 5,515% year-on-year. 

People over 60 in Hawaii (with 453 complaints and $28M lost) were the second-most affected on a per-complaint basis, losing an average of $61,734 per report—a 50.8% increase year-on-year. 

Older residents of the District of Columbia (with 185 complaints and $10.6M lost) were third-most affected on a per-complaint basis, incurring losses of around $57,544 per report, up 155% from the previous year. 

California residents over 60 (11,600 complaints and $643.2M lost) were the fourth-most affected on a per-complaint basis, losing approximately $55,346 per report, up just over 2% year-on-year. 

Elders in New Jersey (with 2,000 complaints and $104.1M lost) were fifth-most affected on a per-complaint basis, losing $50,799 per complaint, up 29.8% from 2022.

How many people are likely affected by these crimes, and to what extent?

Unfortunately, the FBI’s IC3 data isn’t conducive to determining exact numbers of victims of elder fraud. This is because a single fraud report can both include multiple victims and cover multiple categories of fraud. So in the first case, in which a single complaint pertains to more than one victim, the number of complaints would have to be equal to or less than the number of victims. But in the second case—that of a single complaint touching on multiple fraud types—the number of complaints could only be equal to or greater than the number of victims.

An example of this second case could be a romance scam that starts with a personal data breach and involves cryptocurrency fraud in its latter stages. A single victim is defrauded once, but the crime counts towards three types (romance, personal data breach, and cryptocurrency fraud).

This also impacts calculations of the financial losses associated with specific fraud types: complaints involving more than one crime type make ascribing accurate losses to given fraud types impossible. Regardless, the data nonetheless provides ample scope for relative measures and comparisons.

In 2023, tech support scams were reported most frequently—a whopping 17,700 times, virtually the same as the 17,800 reports filed in 2022. The second-most-frequently reported crimes were personal data breaches, reported 7,300 times, down almost 7% since 2022 (during which 7,800 personal data breaches were reported).

How might data brokers be contributing to these crime statistics?

Incogni’s researchers identified 12 crime categories (out of 30) that may be made possible or made worse if the criminals have access to the kinds of information data brokers deal in. What follows is a detailed look at these categories, with a focus on some particularly salient examples.

Of a total of around 101,068 crimes among elders reported in 2023, our researchers identified 52.5% (approx. 53,077 reported crimes) as being facilitated or exacerbated by the availability of victims’ personal data online. This marks a slight, 13% downturn when compared to 2022’s total of 61,000 reports. Crimes enabled by data accessibility were associated with $2.99B in losses, accounting for 87% of total losses.

In 2023, investment scams had the highest loss-to-report ratio and were associated with losses amounting to $1.24B, or a staggering $192,900 per complaint. These were followed by reports of business email compromise (BEC), which were associated with an average loss of $124,100 per complaint. Meanwhile, reports of data breaches accounted for losses of around $71,200 per report on average.

Methodology

Incogni’s researchers examined the Annual Reports and Elder Fraud Reports published by the Internet Crime Complaint Center (IC3), a division of the FBI, looking for details regarding internet crimes against people over the age of 60. This information was collected from people reporting such crimes to the IC3. From these reports, the researchers aggregated yearly losses and complaint counts per crime type. This was also supplemented with 2023 data concerning state-level information.

Using the information gathered, Incogni’s researchers explored trends in complaint counts and amounts lost on a per-crime basis. They took particular note of crimes that may be exacerbated by personal information being available through people search sites and other data brokers. 

Notes on the data:

The FBI started publishing Elder Fraud Reports as companion reports to its annual Internet Crime Reports in 2020, so victim and loss figures for people aged 60+ for years 2018–19 were collected from the IC3’s annual reports.

Furthermore, not all reports made by people and published by the IC3 contain state information. 

The data used in this research is available here: public dataset.

Sources

1. Federal Bureau of Investigation. “2019 Internet Crime Report.” IC3 Annual Report, 2019. Accessed May 6, 2024. https://www.ic3.gov/Media/PDF/AnnualReport/2019_IC3Report.pdf.
2. Federal Bureau of Investigation. “2020 Elder Fraud Report.” Companion report to the IC3 Annual Report, 2020. Accessed May 6, 2024, 2024. https://www.ic3.gov/Media/PDF/AnnualReport/2020_IC3ElderFraudReport.pdf.
3. Federal Bureau of Investigation. “2021 Elder Fraud Report.” Companion report to the IC3 Annual Report, 2021. Accessed May 6, 2024, 2024. https://www.ic3.gov/Media/PDF/AnnualReport/2021_IC3ElderFraudReport.pdf.
4. Federal Bureau of Investigation. “2022 Elder Fraud Report.” Companion report to the IC3 Annual Report, 2022. Accessed May 6, 2024, 2024. https://www.ic3.gov/Media/PDF/AnnualReport/2022_IC3ElderFraudReport.pdf.
5. Federal Bureau of Investigation. “2023 Elder Fraud Report.” Companion report to the IC3 Annual Report, 2023. Accessed May 6, 2024. https://www.ic3.gov/Media/PDF/AnnualReport/2023_IC3ElderFraudReport.pdf.

Visuals

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