An FBI analysis says investment fraud is most likely to affect 30-49-year-olds. In 2023, US consumers lost $4.57 billion to fraud, mostly crypto schemes. In recent years, investment scam complaints and losses have risen. Millennials may not give their savings to Nigerian princes, but they may be defrauded.
A recent FBI report found that investment fraud is most common among Americans aged 30–49. That group sent over 13,000 complaints to the FBI's IC3 last year.
Last year, 30-39-year-olds submitted 6,654 investment fraud complaints. Investment fraud complaints increased to 6,680 in 2023 in the 40-49 age group, which includes some Gen X and the eldest millennials. Age range data from the FBI only includes complaints where the victim specified their age.
According to FBI cyber-crime officer Timothy Langan, "well over half" of tech support scam losses are made by older persons. However, boomers, the largest demographic cohort, finished in third for investment fraud losses with 6,404 FBI reports last year. That suggests they are less prone to dubious financial ventures than their offspring.
Investment scams caused $4.57 billion in IC3 losses in 2023, up 38% from the year before. Just over 20,000 complaints in 2021 rose to over 40,000 in 2023.
The paper attributes that spike to cryptocurrency, which is less regulated and easier to manipulate than conventional financial markets. The analysis estimates that crypto-related thefts cost investors $3.94 billion in 2023, accounting for three-quarters of investment scam losses. According to the FTC, scammers use internet marketing and social media to lure victims with high returns and low risk.
According to the FTC, scammers may offer "secret" or "proven" investing strategies and fake training and products after contacting potential victims. They may also drive victims to a site or app to invest their money while pocketing the money, or they may provide bogus investment reports and encourage more investments.
In 2021, a German guy lost $560,000 to a Twitter scammer posing as Elon Musk, making headlines. Cologne man, whose pseudonym the BBC used, said he gave up his riches thinking Musk would treble it. As one scam victim said, "avoid seduction." Investors should shun get-rich-quick schemes. He advises investors to do their research on even respectable ventures and stock newsletters.
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