What Are Monetary Online Fraud Costs?
According to the first annual report filed by the Internet Crime Complaint Center in 2001, the costs associated with online fraud were estimated at $17.8 million! The majority were from auction frauds, which ran rampant with the rise of eBay. In the grander scheme of crimes, $17.8 million is not a lot of money. Cyber crime was still in its infancy, using naivety as a tool to trick people into falling for the online scam.
Year after year, the cost of online fraud has gone up. It more than doubled in 2002, rising to $54 million, and further rose to $125.6 million in 2003. Currently, as of the 2009 report, online fraud costs are nearly at $560 million! That's an alarming amount of money being lost to criminals around the world. Auction fraud has actually lowered, thanks in part to the increased education of consumers and beefed up security from sites such as eBay. Sadly though, the simplest form of online fraud, email scams have taken the lead for the number of reported cases. Ironically, the email scams often use fraudulent accounts with FBI addresses to steal information from victims.
Another interesting fact is that the majority of crimes are actually not high loss crimes. In fact, the majority of the costs per case fall below $1000. The online fraud cases that cost millions of dollars are actually rare, or it's possible that they're not being reported.