Suspicious activity reports, or SARs, from banks related to fraud are on pace to level off this year for what would be the first time since 2014, when the Financial Crimes Enforcement Network began releasing
Through the end of July, FinCEN had received 890,000 fraud-related reports from depository institutions and loan or finance companies — i.e., banks, credit unions, digital lenders and the like. During the same period last year, the agency had 940,000 such reports. In 2022, that figure was 810,000, a drastic spike from previous years.
Check fraud is also slightly down so far this year, but accounting for an aberrant spike in reports at the start of last year, 2024 could still set another record. Through the end of July, FinCEN had received 300,000 SARs related to check fraud from depository institutions. In 2022, when the year ended with 500,000 reports of check fraud, there had been 290,000 reports through the end of July.
If the pace of overall fraud reports from the first half of the year continues in the second half, 2024 would mark the first year on record that the number of fraud-related SARs have decreased. It is unclear how much of this increase is attributable to improvements at banks in detecting fraud, changes in SAR filing compliance, or other effects that are not related to actual fraud.
The apparent decrease in fraud affecting U.S. banks mirrors data from the Federal Trade Commission showing a decrease in consumer reports of fraud, as well. In the first half of 2023, the FTC recorded 1.3 million consumer complaints about fraud. During the first half of 2024, that number was 1.1 million. Converse to the FinCEN data, the FTC data mainly relates to fraud affecting consumers, such as tech support scams, imposter scams and online shopping fraud.
The FTC aggregates data from a variety of contributors, including the Consumer Financial Protection Bureau, the Better Business Bureau and state law enforcement agencies. Much of the data is based on reports received directly by the FTC.
The FTC data dates back to the first quarter of 2020 and indicates that fraud impacting consumers has been roughly level since 2022 following a spike in 2021, when,
By contrast, consumer complaints of fraud in the U.K. spiked in the first half of the year, according to
With respect to consumer fraud in the U.S., perpetrators most often defrauded their victims by obtaining a credit card payment, according to
Although fraudsters most commonly used victims' credit cards for payment, the largest losses occurred via bank transfers. Consumers reported nearly $1 billion in losses via bank transfers in the first half of the year, with investment schemes representing nearly half of those losses. Cryptocurrency accounted for $680 million in losses; credit cards accounted for $130 million.
Social media tends to be the most effective communication method for defrauding consumers, according to the FTC data. Of the 46,000 reports in the first half of the year where the consumer reported being contacted via social media, 69% also reported a specific financial loss.
By comparison, email is the least effective method of communication for stealing from consumers; of the 77,000 reports in which email was the contact method, only 12% of reporters provided a specific financial loss.
