CHARLESTON, W.Va. — A recent national study from AARP is showing that fraud scams are on the rise with a total of 2.4 million being reported last year alone, but the interest group is now working with policy makers in West Virginia and across the country to help put a stop to the problem.
According to the Federal Trade Commission, the reported losses to fraud skyrocketed to $9 billion last year, but they predict more however, due to the under reported nature of scam victimization.
The impact of the crime is profound according to AARP, particularly for older Americans who have reached a time in their lives where they’re financially unable to recover.
AARP’s Government Affairs Director Barrie Tabin Berger told MetroNews they have been working with lawmakers to develop a Consumer Fraud Restitution Fund to help address the issue.
“Our legislative activity is taking shape in two different ways, prevention and recovery, and the restitution funds are recovery,” said Berger.
The restitution fund will work through the collection of civil penalty payments by the State Attorney General’s Office from consumer fraud enforcement cases. Victims associated with a case will receive compensation from the money that’s collected in the case as restitution, but Berger said that not all of the funds stolen from the victims will be reimbursed back to them.
However, she said the funds will also help alleviate the impact of future fraud crimes by encouraging more reporting and prosecution of them.
“The numbers that we have are not nearly as high as they should be, because folks don’t report because they’re embarrassed or they think ‘what’s going to happen if I report, I’m not going to be able to recover anything,” she said.
In addition to fraud fund restitution legislation, they are also working to specifically develop legislation for a Consumer Securities Fraud Restitution Fund, as many have reportedly lost a total of $3.8 billion last year from scams such as fake investment schemes.
Berger said another piece of legislation they are trying to get into law pertains to gift cards as they are one of the most frequently used payment methods for fraud.
An AARP survey shows that 1/3 of U.S. consumers have been asked to purchase gift cards to pay a debt, and while Berger said no credible agency would ever ask a person to do this, nearly 1/4 of people follow through with the request.
To help resolve this, AARP is supporting state legislation that would require stores where gift cards are sold to post signage alerting shoppers to protect themselves from gift card scams and what to do if they become victims to this type of scam.
“It’s just another way to intervene an to stop the fraud before it takes place, so we’re hoping to get something moving like that, because con artists are really latching on to gift card fraud as a means of stealing from unsuspecting folks,” said Berger.
Berger said AARP’s goal is to continue to work with West Virginia lawmakers to get the fraud restitution bills and the gift card bills signed into law during the state’s next legislative session in January.
According to the AARP, of the millions of scams being reported by consumers, the five most common were imposter scams, online shopping, scams involving prizes or sweepstakes, investment scams, and business or job opportunity scams. Berger said these scams can happen to anyone.
“It doesn’t have to do with education, it doesn’t have to do with background, it doesn’t have to do with gender, anyone can be a victim,” Berger said. “And one of the things AARP has been focused on a lot is not blaming the victim, just like if you were a victim of a robbery no-one would be blaming you, if you’re a victim of fraud it is not your fault.”