Close your eyes and picture someone at the wrong end of an online scam. Who do you see? Odds are the person looks something like a helpless old lady with thick horn-rimmed glasses and an unsettling willingness to fork over her bank information.
But these days, that years-old stereotype is far from accurate. Tired depictions of naive old woman have masked an unnerving fact: It’s computer-literate millennials and Gen Z who have the real problem with online scams. In recent years, people ages 39 and under have been 25 percent more likely to report losing money to fraud than the 40-plus crowd, according to the Federal Trade Commission. That translates to $450 million of lost millennial money over a two-year period ending in August.
The truth is, many Americans who came of age before the internet have approached online payments with a healthy dose of skepticism, which has proven useful as the internet has transformed into particularly fertile ground for fraudsters. Younger people who have practically grown up online, however, have displayed a comfort with handing over personal information that is now regularly backfiring on them.
Today, millennials are less likely to fall for scams over the phone than people over 40, but 77 percent more likely to get duped by email scams, and 90 percent more likely to lose money on a fake check scam, like when a person you don’t know asks you to deposit a check and wire some of that money back to them, according to the FTC. When it comes to online shopping scams, things get particularly bleak: People in their 20s and 30s are more than twice as likely to report getting swindled than older Americans—in the past two years, millennials and Gen Z have lost $70 million to buying items that are never delivered or not at all how they’re advertised
“When we’re looking at the differences in reporting [between age groups], it’s really, really jarring,” said Monica Vaca, the associate director of the FTC’s division of consumer response and operations.
The FTC’s findings are backed up by the Better Business Bureau, a nonprofit organization that closely tracks scam activity. The Better Business Bureau has found that while young Americans typically lose considerably less money when they fall prey to a scam, they are dramatically more susceptible to doing so.
“We were initially surprised by the results,” said Katherine Hutt, the Better Business Bureau’s national spokesperson. “For years, the stereotype has been the little old lady as scam victim. So we were genuinely surprised to see that older Americans basically had gotten the message and were less at risk than young people.”
People who told the Better Business Bureau they had been exposed to an online purchase scam in 2018 lost cash three-quarters of the time, while people who were exposed to scams more generally only ended up losing money one-third of the time. That effectiveness helps explain why websites shot past phones in 2018 as “the top means of contact for scams reporting a monetary loss.” Scams involving online purchases were not only the most common scam, but the type of scam with the most victims.
People ages 18 to 34 were fooled particularly often by employment scams—in which people are offered a job and then duped in any of a variety of ways. They can be told to submit sensitive information, instructed to hand over money for equipment, or “overpaid” by way of a bad check and asked to return some of the money.
Unsurprisingly, one area of particularly strong scam growth has been on various social media platforms, according to the Better Business Bureau. Hutt said the growth of scams tied to online shopping and social media doesn’t surprise her. “Scammers go where the consumers are,” Hutt said. “If young people are on Instagram more, that’s where they’re going to go.”
People should be wary of ads they see on social media and fake websites that appear to be retail outlets, according to Vaca and Hutt. But what concerns Hutt more is how often these scammers are also lurking within well-established third-party platforms like Amazon, Etsy, and eBay.
“They figure out not only how to fool consumers, they also figure out how to fool companies and online marketplaces,” she said. “We’re seeing a lot of that.”
“Anybody will think, ‘Oh well, I’m safe if I’m shopping on eBay or Etsy or Amazon,” she said. “But there are third-party vendors on those sites that are scammers as well.” (eBay offers a money back guarantee to those who have been scammed, and Amazon lists specific directions for those who believe they have been victims of fraud.)
Vaca said another troubling trend is compounding the problem: Lots of millennials aren’t paying for things online with credit cards, which come with federal protections against scams. Instead, they’re often opting to wire people money or use online payment systems like Venmo, which do not offer the same protections. “When they’re not paying with credit cards, you’re a lot more financially exposed,” she said.
The Better Business Bureau has found one other scam-aligned characteristic that will feel familiar to many internet users: loneliness. “Specifically, losing money was associated with more frequent feelings of being left out, lacking companionship, and being isolated from others,” the Better Business Bureau wrote in September.
Vaca said it’s critical that millennials and Gen Z start to realize that growing up on the internet doesn’t make you less susceptible to scammers. In fact, there are signs it’s having quite the opposite effect.
“There’s a sense of complacency that can develop if you feel like, ‘Oh yeah, my grandma is vulnerable to this stuff, but I’m not,’” she said.