The Umbrella

It is often assumed that older Americans are more prone to be victims of online scams. That may be true in many contexts and certainly the online targeting of vulnerable, elderly continues to soar. But, in fact, some scams disproportionately affect younger people. While all age groups fall victim to online fraud, recent data suggests that the type and magnitude of fraud varies based on generational differences. Let’s dive in and see what is going on.

Types of online scams that hit younger consumers harder

According to a recent Federal Trade Commission (FTC) report, younger adults (ages 18-59), including Gen Xers, Millennials and Gen Z, were 34% more likely than those aged 60 and over to report financial loss due to scams in 2021. In particular, there was a noteworthy generational difference when it came to the following types of scams:

Online Shopping Scams:

• In particular, online shopping fraud, often originating from social media ads, was a prevalent issue for the 18-59 age group. Fraudulent online shopping is the most reported type of fraud leading to financial losses across all age groups. Yet, older individuals were not as likely to report monetary losses from online shopping fraud compared to their younger counterparts.

Investment Scams:

• Younger adults were also over four times more likely to report that they fell victim to investment scams, particularly those involving deceptive cryptocurrency opportunities. It is noteworthy that the FTC’s data is from 2021, during the peak crypto mania. This is not to suggest that older consumers were not victims of investment scams, especially cryptocurrency scams. In fact, reported investment scam losses by those over 60 tripled in 2021, including crypto related scams which surged ninefold, but simply that younger consumers outpaced those dismal numbers.

Employment Scams:

• Additionally, younger adults reported losses from job scams at a rate more than five times higher than older adults.

Types of online scams that disproportionally impact older Americans

Meanwhile, more senior consumers are much more likely to report being victim of the following types of online scams:

Tech support scams:

• Tech support scams make consumers believe that there is a fake urgent security issue. According to the FTC, those over 60 reported being an astounding 398% more likely to report financial losses from tech support scams.

Sweepstakes, lottery or prize scams: 

• Older adults were also over twice as likely to lose money to sweepstakes, lottery or prize scams. These types of scams trick people into sending money for non-existent winnings. Those aged 80 and above report being hit shockingly hard by this type of scam. Of all the fraud losses reported by that group, roughly one-third were attributed to one of these fake prize scams.

Family and Friend Impersonation Scams:

• Consumers over 60 were 45% more likely to report financial loss from fraud involving a Family and Friend Impersonation Scam.

Older Americans report much higher individual losses to fraud

There are also generational differences when it comes to the magnitude of losses. In 2021, the typical 18-59 fraud victim reported a median loss of $500. Those 70 and over reported much higher median individual losses. The median reported loss was $800 for people 70-79, and an enormous $1,500 for those 80 and over.

Are older Americans more savvy about fraud than younger consumers?

Interestingly, those over 60 were far more likely to report instances of fraud where there was no monetary loss, as compared to younger consumers. In fact, older consumers were a whopping 68% more likely to file this type of “no-loss” report. Contrary to popular narratives, the FTC itself makes a surprising observation, that older adults may have a knack for dodging financial setbacks in the face of fraud and that older consumers may lean towards reporting instances of fraud, even when no tangible loss occurred. Other FTC findings about fraud “rates of victimization” support this assertion. That might be a bit of a stretch, but at a minimum, older consumers certainly do seem more likely to take the time to report instances of no-loss fraud.

It is worth mentioning that the FTC data has some drawbacks. It comes largely from their Consumer Sentinel, which is self-reported data. And, of course, only a tiny fraction of actual online fraud is ever reported. That said, the FTC data does give us a reasonable snapshot of what is occurring.