Scammer business model still intact!

Little has changed! Dating and romance scam business model still intact! Slight reductions in figures indicate the ACCC is having some impact, however the tens of millions of dollars lost is incomprehensible, and does not tell the story of the impact of the dollars lost on victims.

scamed woman

Last week the latest scam statistics Targeting scams Report of the ACCC on scams activity 2015 were published by the Australian Competition and Consumer Commission (ACCC), though this time the figures included investment scams, not just romance scams, because more money was lost through this scam.  What is astounding is that the Scamwatch figures for romance scams, though, are still at such a high level, of tens of millions of dollars!  And then they added figures from other sources, ACORN and the Scam Disruption project and get even more!

“In 2015, Scamwatch reports for dating and romance scams decreased slightly but were still significant with just under $23 million in reported losses from 2,620 complaints. Of this $5.6 million was lost to victims over 55, with 464 complaints from this age group. ACORN reports for romance scams totals $15 million. When you add these losses to those from the disruption work ($17m), this brings the total losses for relationship scams to over $54 million.”

This remaining high level is incomprehensible. It is indefensible, and inexcusable.  But with the complexity of disguised overseas perpetrators in jurisdictions that they cannot influence, what can Australian officials do? The ACCC has chosen three tacks:

1.     Continuing and expanding the scam disruption project

The ACCC is continuing and expanding the scam disruption project, where they identify money being sent to known hotspots (countries in West Africa) and send letters to people warning them it might be a scam.  This has expanded from just NSW to Victoria, Tasmania, and the Northern Territory in July 2015,  “aimed at intercepting, interrupting and impeding scams—is a key element in minimising and, in many cases, preventing further harm.” (Report page 18). Queensland, Western Australia and South Australia have their own disruption projects.

These are having significant results of 75% of people sent letters not sending further money, and as a consequence the number of people detected as sending money to high risk countries has significantly reduced. Noticeably this drop was evident in the States where the disruption project recently commenced. However, there is still concern for those who do not stop sending money, and for those where money  might be sent to other countries not identified as so high risk.

Losses reported to Scamwatch from dating and romance scams have reduced by scam alertmore than $5 million (18.5 per cent) to $22.7 million” the latest report explains. 18.5% is a reasonable change in one year you might think, however I am concerned about the $23 million still going out of people’s savings, super, through increased debt, and the disaster of these losses once people realise they have been caught in a fraud.

2.     Rewrite the guidelines for romance and dating agencies, to stop scammers from communicating with targets

“Almost 24% of dating scams reported meeting through social networking sites or online forums”

In February this year, the ACCC released a revised edition of its Best Practice Guidelines for Dating Sites, with an aim to:

  1. “Strengthen the targeting, relevance and timeliness of warning measures
  2. Ensure effective complaint handling
  3. Promote vigilance to prevent scammers operating on their sites…
  4. Encourage dating sites to use the guidelines provided to protect users from such scams”

The guidelines apply to all dating sites used by Australians, where they are based in Australia or Overseas and focus on:

  • Appropriate warnings of scams and related information about risks of scams
  • Vetting and checking to ensure scammers cannot register on dating sites
  • Complaint handling procedures
  • Consumer protection

This must be a step in the right direction, but whilst the guidelines are voluntary, those that are already following good procedures will continue to do so, and those that don’t, won’t, because there is not consequence for them.  The consequence is for us, the unwary victim of unscrupulous fraudsters.

3.     Better educate and warn consumers.

The release of these statistics has brought a flurry of newspaper articles, including:

Investment schemes overtake fake romance as the top money-spinner for scammers: ACCC, in the Business Day section of the Sydney Morning Herald on May 16, 2016, by Esther Han.
This article talks about the experience of Ruth Robertson, who has courageously shared her story to warn others.

The Scamwatch statistics from the ACCC show a 30% conversion rate from those who reported being caught in scams, to those who actually gave and lost money.  This is a reduction from 41% from 2014, which also might be an indication that some of these techniques of the ACCC are working.  (As an interesting aside, the only areas where the ACCC reported conversion rate increased from 2014 to 2015 were Mobile Premium Services; Psychics and Clairvoyants; Computer prediction software & sports investment schemes; Nigerian scams and Travel Prise Money scams.)

The report also comments on our (mis)conceptions of those who succumb to a scam.

“There is a common misconception that only the gullible and greedy fall victim to a scam, however, many professional and well-educated people have been taken in. Scammers are particularly good at presenting themselves in a convincing light and will use any information they can to persuade their victims to part with their money. The more detail they have about your personal circumstances, the greater the risk of becoming a victim.”

Cassandra Cross, also taking the opportunity to write for Fraud Week in The Conversation’s article Why we need to do more for the victims of online fraud and scams on May 19 reflects on her ongoing research into the effect of scams on victims, and how they need more consideration.

“It is hard to imagine that we currently have a justice system, where the barriers to reporting fraud outweigh the ability of victims to be heard and where fraud victims are often directly blamed for their situation. Where what has happened is trivialised, minimised or not even acknowledged, by law enforcement, other agencies, families and friends.”

I continually hear stories myself of reports to the police being fobbed off, disregarded, and the individual blamed themselves. Reporting to ACORN or Scamwatch does not seem to generate any action though it may help behind the scenes. It is no wonder that all ACCC Scam reports always include the caveat that these statistics are the tip of the iceberg, that may people are too ashamed to report.  According to Cassandra Cross, they have good reason.


ACCC Full Report: Scam activity 2015:

Press release for the Report:

Best practice Guidelines for dating sites:

Scam Disruption Project:


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Jan Marshall

I was the victim of an online romance scam in 2012. I lost over $260k. I share my understanding about what happened, how I recovered and the latest trends

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