Cross-Border Fraud: How Bad Is It?

computer hacker 150x150 Cross Border Fraud: How Bad Is It?The Internet can be a wonderful tool. In the wrong hands, it can also facilitate scams reaching across national boundaries: Pyramid schemes, advance-fee loan scams, bogus foreign lotteries or sweepstakes, and phony mail-order brides.

In my office days at the BBB, I received dozens of reports of such scams. While the BBB does record and share this information and provide options to callers, you also need to report scammers to the Federal Trade Commission.

When you file an FTC complaint, your data is entered into Consumer Sentinel, an online database available to over 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.

Recent FTC statistics suggest the seriousness of the cross-border fraud problem:

  1. Between 2006 and 2011, almost half a million U.S. consumers (471,014) complained about transactions involving over $1.4 billion paid to businesses in other countries.
  2. The number of U.S. consumer complaints against foreign businesses exceeded 100,000 in 2011 alone.
  3. Cross-border complaints have accounted for more than 10% of all Consumer Sentinel fraud complaints every year since 2000, with a high of 22% in 2006 and 13% for each of the last three years. These numbers likely understate the scope of the problem, as this complaint count includes only those instances where consumers report a foreign address.
  4. U.S. consumers complain about foreign businesses from an increasingly broad range of countries. In 2002 over 55% of such complaints were about Canadian businesses; in 2011 over 85% were about businesses in other foreign countries.

Now the FTC is urging Congress to renew the US SAFE WEB Act, which is set to expire in 2013. Hugh Stevenson, Deputy Director for International Consumer Protection, says that since the Act’s passage in 2006, the FTC has conducted more than 100 investigations with international components, such as foreign targets, evidence, or assets, and has filed more than 50 cases with cross-border aspects.

Using the Act’s tools of information sharing, investigative assistance, cross-border jurisdictional authority and enforcement relationships, the agency says it has stopped frauds costing American consumers hundreds of millions of dollars.

Remember, before you do business with a company, check out their track record at where we have hundreds of records for U.S. and Canadian businesses. Be aware that if you are scammed by someone overseas, it may be harder to get your money back, if not impossible.

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About Holly Doering

Holly Doering has worked for the Better Business Bureau Serving Eastern Washington, North Idaho, and Montana for half a decade. Her areas of expertise include the CORE Values Program (Character, Optimism, Respect, Ethics) for Teens and Charity Review as well as writing and editing. Prior to that, she has written for two newspapers, a local magazine, and taught English at the community college. She is the proud author of a short story in ZYZZYVA literary magazine and has had good luck publishing lots of poetry. Each year she rolls up her sleeves and wades into the autumn Nanowrimo writing madness and has several unfinished novels to her credit.