Michigan ranks high in the U.S. for agricultural products and manufacturing. Now, add fraud complaints to that list.
According to a new Federal Trade Commission report, Michigan is No. 3 in the nation when it comes to reporting swindles per-capita and No. 6 in identity theft complaints.
Last year, the state was fifth nationally in fraud gripes; its ID theft berth hasn’t changed. Michigan had 113,474 fraud complaints and 15,684 identity theft ones.
The FTC’s Consumer Sentinel Network Data Book reported close to 3.1 million complaints nationally in 2015, up from more than 2.6 million in 2014. When the data was first collected in 2001, there were 325,000-plus complaints.
The 2015 total was 40% fraud, 16% identity theft issues and 40% other complaints, which includes banks and lenders, lotteries and shop-at-home and catalog sales.
Last year, these scams cost consumers more than $765 million and the median amount a victim lost was $400. Most people — 57%, to be exact — who reported fraud gripes don’t give the cons any money, but plenty others do, like the 15,000 people who handed over more than $5,000 each. And yes, the majority of people who do fork over money do so via wire transfer.
Puneet Manchanda, a professor of marketing at the University of Michigan’s Ross School of Business, said Michigan is a ripe target for scammers, particularly because of two large segments of the population here — immigrants and the elderly.
People who have moved to the U.S. might not fully understand how things like credit and banking in this country work and will be more willing to comply with someone they think works for the government. So a caller claiming he or she is with the IRS may be given all sorts of personal data. And older people are less savvy about technology and the con artists it can foster and tend to be more motivated by alarmist pitches.
But both groups also are more likely to report being conned to the police, the professor added.
“Our legal systems and protections have not caught up with the realities of the digital world,” Manchanda said. “The scammers will always be ahead. The solution is regulation and education.”
Three out of four frauds start with a phone call and only 8% come via e-mail, the FTC data found. Only Florida and Georgia had more fraud complaints per capita than Michigan.
The vast majority of reported scams originate from the U.S. with 96%.
The most fraud complaints came from those ages 60-69 (21%) and ages 50-59 (20%). The fewest came from people age 19 and younger — 1%.
Those who reported having their identities stolen said this information was misused mostly for tax- and wage-related fraud at 45%, credit card fraud (16%), phone or utilities fraud (10%), bank fraud (6%), loan fraud (4%) and employment-related fraud (3%).
Only 37% of those people said they told police, according to the FTC report.
The five states with more identity thefts reported than Michigan per capita are Missouri, Connecticut, Florida, Maryland and Illinois.
Twenty-four percent of identity theft complaints came from people ages 50-59, making them the largest cohort. On the other end were individuals ages 19 and below at 5%.
To Andrea Bitely, spokeswoman for Michigan Attorney General Bill Schuette, the fact that Michigan ranked high in the country for fraud and identity theft complaint reports doesn’t mean there are more scams happening here — rather that Michiganders are telling police about it.
“It’s good people in Michigan are reporting these crimes because the more people report these crimes, the better law enforcement can become,” she said.
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In Michigan, the fraud complaints were:
Debt Collection — 65,130 complaints, 57%
Telephone and Mobile Services — 15,769, 14%
Impostor Scams — 9,209, 8%
Prizes, Sweepstakes and Lotteries — 3,464, 3%
Banks and Lenders — 3,170, 3%
Shop-at-Home and Catalog Sales — 2,127, 2%
Auto-Related Complaints — 1,665, 1%
Television and Electronic Media — 1,524, 1%
Credit Cards — 962, 1%
Credit Bureaus, Information Furnishers and Report Users — 891, 1%
Source: FTC Consumer Sentinel Network Data Book
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