Could Robocalls Eclipse Identity Theft As The New Frontier in Fraud?
With the first year anniversary of the massive Equifax security fail just behind us, followed quickly by the introduction of nationwide free credit freezes for everyone (including kids), now’s as good a time as any to think about how both events could collide to impact consumers.
It’s a widely accepted view that crooks will often wait at least a year before trying to monetize stolen data, in the expectation that free credit monitoring will have expired and guards will be lowered.
Whether that's true or not, the first anniversary of any major data breach should always be a good reminder for consumers to stay vigilant. But it’s the second event that worries me more.
More Than Just A Ringing Pain
For nearly 15 years, identity theft has ranked as the #1 crime and consumer fear in America, claiming an average of more than a million victims and at a cost of more than a billion dollars every single month.
But the king of crime is being stalked by a new pretender to the throne that could steal even more money from consumers - and leave them with little recourse.
Robocalls used to be just plain irritating. But with such a rapid evolution of the crime, my biggest fear is that robocalls will soon eclipse identity theft as the new frontier in fraud. Ask any crook. If you can get a live victim on the line, you're already half way there.
Last year alone, American consumers received nearly 98 million robocalls every single day, and victims of phone fraud lost close to $10 billion in just 12 months, according to the Federal Trade Commission. And those numbers could be conservative.
No Freezing This Fraud
Unlike identity theft, which can often be blocked or detected by things like credit freezes and fraud alerts, once a caller has a victim on the line the only defense left is the vigilance of the victim. And that’s a defense most good social engineers can easily blow past.
And also unlike victims of identity theft, who usually suffer zero financial losses because of zero liability policies, victims of phone fraud resulting from robocalls may be on the hook for some or all of the losses.
There’s no reason to believe that phone fraud losses that result from robocalls won’t exceed losses to identity theft. If they haven’t ready. A crime that’s easy and cheap to commit, combined with a huge potential payout and little risk of being caught? That offers an irresistible recipe to a new generation of crooks who know that as soon as they can get you on the phone, your money’s almost as good as theirs.
And the timing isn’t helping. As those new credit freeze laws come into effect nationwide, criminals will just switch tactics and instead of going through the credit bureaus, they’ll go directly to the victims.
So what can you do to avoid falling victim to this scam?
- Take robocalls seriously, not just as an irritant but as a direct call to you from a crook who plans to steal your money.
- The best defense of all is to simply not pick up the phone. No matter how genuine the call appears to be.
- Be wary of “neighborhood spoofing” – calls that appear to come from your local area code. Callers can easily spoof your local area code.
- If you do pick up, don’t press any keys and don’t engage with the caller. Just like responding to spam, engaging only brings you one step closer to the trap.
- Speak to everyone in your family, and especially the elderly and kids, about what robocalls are and about the importance of being vigilant.
- Talk to your carrier about what robocall-blocking services they offer. If your carrier insists on charging you extra to block calls, just make sure you’re satisfied that you’re getting what you pay for.
- Consider downloading one of the growing number of apps designed to prevent robocalls. But do your homework first, and make sure you’re not agreeing to hand over too much of your personal information in exchange.
- Report robocalls to the Federal Trade Commission at 1-877-FTC-HELP. They can’t solve the problem, yet, but you might be able to help them identify the source of the unwanted calls.
- List all your numbers with the Do Not Call Registry. This registry won’t block criminals, or political calls, but might reduce the volume of legitimate but unwanted calls.