The Global Anti-Scam Alliance (GASA), in partnership with Feedzai, has unveiled a startling report on the global state of scams, estimating that worldwide scam losses over the past year have exceeded $1.03 trillion. This figure, surpassing the GDP of countries like Switzerland and Poland, highlights the alarming economic impact of scams, which affect consumer confidence and impose significant burdens on economies worldwide.
According to the report, scam prevalence is highest in South Korea, Hong Kong, and Brazil, while Americans have the highest per capita loss at $3,520, followed by residents of Denmark and Switzerland. Shopping and investment scams are cited as the most common types, with Nigeria and Kenya leading in shopping scams and Nigeria ranking highest in investment scam prevalence.
Social Media and Technology Usage in Scams
The report highlights how scammers leverage social media platforms like Facebook, Gmail, Instagram, and WhatsApp, using AI technology to create convincing fake content, including videos, images, and voices. This tactic has elevated scam sophistication, enabling fraudsters to deceive victims effectively.
The Need for Reporting and Holistic Fraud Prevention
The report also underscores that 70% of scam victims do not report incidents, complicating efforts to address the issue. GASA calls for a holistic approach, addressing both financial recovery and the psychological well-being of victims, as scams often lead to feelings of fear and mistrust.
Economic and Psychological Impact
Scams impose a substantial economic burden, causing an estimated 4% loss in GDP in developing nations such as Nigeria, Kenya, South Africa, and Pakistan. Although developed nations experience a lower economic impact (0.5% GDP loss), the issue remains significant. GASA’s survey data, gathered from over 58,000 respondents, shows that half the global population encounters scam attempts weekly, underscoring the pervasive nature of scams across the world.
Feedzai’s Co-Founder and CEO, Nuno Sebastião, emphasized the role of financial institutions and technology in combating scams, noting that consumer confidence in recognizing scams has improved. “This strong display of confidence is a testament to banks’ and others’ efforts to educate consumers on the red flags to watch for,” Sebastião said.
Also, The GASA report highlights the need for collective action to restore trust in digital spaces and ensure that consumers feel secure in online transactions.
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