Millennials most likely to fall prey to scams
Millennials often are considered digital natives, given their proficiency with technology, but they also may be considered a bit naive when it comes to dealing with online and phone fraud.
Research has found that not only are millennials the generation most likely to fall prey to scams, they're also the least likely to properly protect their mobile devices.
"They're a generation of folks that is much more plugged into digital society as natives. That doesn't mean anyone taught them how to navigate it safely," says Lance Hayden, adjunct assistant professor at the University of Texas at Austin School of Information. "In many cases they're hungry for knowledge to protect themselves."
A study released in January 2016 by the mobile communications company Truecaller found 11 percent of Americans lost money in a phone scam in the previous 12 months. But among 18- to 34-year-olds, 17 percent of women and a surprising 38 percent of men said they'd been victimized.
Based on the survey findings, Truecaller estimates 27 million Americans had been victims of phone scams in 2015, compared to 17 million the previous year. Losses averaged $274 per victim. That adds up to a whopping estimated $7.4 billion in total losses.
Truecaller found nearly three-quarters of scams occurred using a mobile phone, compared to about half of all phone scams the previous year. That's driven in part by consumers dropping their landlines and only using mobile phones.
The average American receives about 16 spam phone calls and six spam texts each month. That totals 48 billion spam calls and 17 billion spam texts over the course of a year, Truecaller found.
Things aren't any better for millennials when it comes to Internet safety. Norton, which provides computer security software, surveyed more than 17,000 adults in 17 countries and found 44 percent of millennials had been a victim of online crime in 2015. It's a sharp contrast to baby boomers: Just 16 percent had been victimized.
It doesn't help that the vast majority of millennials do things such as check financial accounts when connected to public Wi-Fi, store bank account information in their phones, and don't use passwords to protect their mobile devices, according to a study by TransUnion, which provides credit information.
Millennials "grew up with technology. Maybe they take it for granted a little bit," especially when compared to older generations, says Ken Chaplin, senior vice president at TransUnion.
Millennials also "often don't have nearly as good habits when it comes to security when they're online. They could more aware of risks, but are more cavalier," says Rob Douglas, an identity theft expert.
For example, the Norton study found 18- to 34-year olds are far more likely to share their passwords than other age groups.
Douglas says that's because millennials grew up being taught to share everything, and have embraced the sharing economy, "it sometimes bleeds over into sharing passwords" for social media or online entertainment. That can open them up to the increased risk of identity theft and scams.
Social networking also has a role to play, Hayden says. "There's an element of trust that comes with it."
Popularity may be gauged by the more "likes" and "friends" someone has, and friendships may be virtual. "How do you judge whether someone has your best interest at heart?" Hayden asks.
He's also found millennials may not be able to judge the difference between news and entertainment. "There's a blurring of the lines between what's real and what's not," which can make it hard to judge if something is a hoax.
Millennials also have the reputation for wanting to help people and do good, and with crowdfunding sites, "Money just becomes one more thing you share," Hayden says. And by using credit cards or PayPal, "It doesn't feel the same as cash."
"If someone asks for sensitive information or money, it should ring alarms," Hsieh cautions.
The Federal Trade Commission report found 33 percent of those who lost money to scammers used a prepaid card, while 13 percent used a credit card and 11 percent used a debit card.
That fits with the millennial mindset. It's a generation that has tended to embrace prepaid cards and shy away from traditional credit cards.
Truecaller's survey found 30 percent of those who fell victim to a phone scam canceled their credit card or changed their account number, while 27 percent signed up for credit monitoring or credit protection.
There are ways to help protect yourself from phone and online scams and fraud. They include:
- Putting a password on all your mobile devices.
- Not using public Wi-Fi to make financial transactions.
- Installing software that will allow you to erase your phone if you lose it.
- Not storing financial and other sensitive information on your phone.
- Installing a caller ID and spam blocker app on your phone.
Truecaller, for example, offers a phone app that can help identify callers and flag if the number has been identified as spam by other Truecaller users.
- Judge lets Trump appointee remain as CFPB head – A federal judge rules against a challenge that said Mick Mulvaney's appointment as acting director undermines the consumer protection bureau's independence ...
- First-time fraud victims likely to be hit again – With reload scams and sucker lists, some first-time fraud victims are fleeced over and over ...
- True tales of card fraud victims who fought back – Oftentimes, card thieves are not held accountable for their crimes. These victims made sure they were ...