Survey Reveals More than 40% of Young Adults Fall Victim to Online Scams Despite Digital Literacy
In the digital age where hackers and scammers are always on the prowl for unsuspecting victims, older people are considered vulnerable because of lower awareness about the internet. But a recent survey conducted by TD Bank Group has revealed that a large number of young adults, known for their digital prowess, have fallen prey to online scams, via Retail Banker International. It shows that 41% of the respondents aged 18 to 34 have been targeted by fraudsters on social media, surpassing reported cases among older demographics. Sophia Leung, a fraud expert at TD, emphasized that being technologically savvy does not render individuals immune to the perils of online scams. Despite the prevalent narrative surrounding scams targeting seniors, the survey revealed heightened concerns among young people about financial fraud victimization.
Key survey highlights
The latest TD survey uncovered alarming trends as over half of respondents (62%) admitted feeling vulnerable to online scams, with 63% believing scams are on the rise. The study also revealed a significant underreporting pattern, with 43% hesitant to disclose falling victim to fraud due to embarrassment. TD's fraud expert, Sophia Leung, emphasized the escalating sophistication of financial fraud schemes, contributing to detection challenges. Leung encouraged individuals not to be embarrassed by falling victim but stressed the importance of remaining vigilant and informed to thwart future fraud attempts. The survey indicates a pressing need for enhanced awareness and education on recognizing and reporting online fraudulent activities.
Preventing scams: Education is key
According to TD, fraud prevention education is crucial for safeguarding well-being and digital security. Despite young adults dedicating time to anti-fraud education, concerns persist about falling victim to various scams, including job scams (19%), investment scams (15%), and cheque scams (12%). TD's advice includes caution regarding unsolicited job offers promising "easy money" through text or email. The bank recommends skepticism towards job opportunities that require the use of personal bank accounts for money transfers.
For investment scams marked by false urgency, TD advises Canadians to be skeptical and take their time before making impulsive financial decisions. This advice is applicable across generations, including seniors who have been targets of major phone scams in recent years.
Impact of technology and AI
The rise of AI-enabled technology poses a significant challenge as fraudsters exploit its capabilities to deceive investors. Techniques such as voice cloning, image alteration, and the creation of fake videos, including "deepfake" audio, are used to spread false or misleading information. The alarming trend involves scammers impersonating family members, friends, or even CEOs of companies to manipulate investors. For instance, deepfake audio might be employed to trick older investors into believing a family member is in financial distress. Scammers also leverage AI to create realistic websites, marketing materials, or announcements, leading to fraudulent schemes. The challenge extends to the impersonation of SEC staff and government officials.
Earlier in Feb 2024, a Hong Kong-based multinational firm suffered a loss of approximately $34.5 million due to scammers using AI to orchestrate a phony video conference call. The incident sheds light on the evolving tactics scammers employ to exploit unsuspecting victims. As of December 31, 2023, the Canadian Anti-Fraud Centre reported processing 62,365 reports, with $544 million lost to fraud.