FBI says Internet fraud is on the rise

11-04-2002

by Paula Mythen

Almost 43 percent of all reported Internet fraud comes from auction fraud, according to the Internet Fraud Complaint Center's annual data trends report.

The IFCC, a partnership between the Federal Bureau of Investigation (FBI) and the non-profit organisation, the National White Collar Crime Center (NW3C), said that 49,711 complaints were filed during the January to December 2001 period.

"This borderless phenomena is a unique characteristic of Internet crime and is not found with many other types of traditional crime," said Thomas Richardson, Deputy Assistant Director, Criminal Investigative Division of the FBI. "Jurisdictional issues often require the cooperation of multiple agencies to resolve a case. This is a hallmark of the IFCC. It streamlines the case initiation effort and saves victims and enforcement agencies a great deal of time."

Auction fraud accounted for the highest percentage of on-line fraud, with non-deliverable merchandise and non-payment accounting for 20.3 percent of complaints and Nigerian Letter fraud making up nearly 15.5 percent of complaints. The top five fraud categories also included credit/debit card fraud and confidence fraud.

Many of the complaints the IFCC has taken involve incidents like computer intrusion, and child pornography and were not Internet-fraud specific.

Of the on-line filings, the IFCC referred 16,775 Internet fraud complaints to law enforcement or regulatory agencies. A May 2001 initiative called "Operation Cyber Loss" resulted in criminal charges being brought against approximately 90 individuals, representing over 56,000 victims who suffered cumulative losses of over USD117 million.

"We anticipate the number of complaints to rise from 1,000 a week to 1,000 a day," said Richard L. Johnston, Director of the NW3C. "We know more Internet crime is out there, it's just a matter of victims knowing where to go to report it and then actually reporting it."