Risk factors for advance fee fraud victimisation

29 Aug 2011

This paper explores why people respond to unsolicited invitations for upfront payments to secure a deferred financial benefit that later prove to be fraudulent.

Fraud is Australia's most costly form of crime with the Australian Institute of Criminology estimating that in excess of $8.5b was lost to fraud in 2005 (Rollings 2008).  Consumer fraud alone has been found to cost Australians almost $1b each yaer (ABS 2008c).  Most types of consumer fraud entail the use of so-called 'advance fee' techniques in which individuals are tricked into paying money - an 'advance fee' - upfront in roder to secure an anticipated financial or other benefit at a later date.  However, the promises of wealth are false and victims invariably lose their payments in full.  Such scams had had a huge impact globally, with Ultrascan (2008) estimating that US$4.3b was lost to adance fee fraud in 2006.  To date, however, there has been only limited research on how and why people respond to such unsolicited invitations and become victims. This paper examines the characteristics of a sample of victims of advance fee frauds to determine how their behaviour and personal circumstances might have contributed to their willingness to respond to unsolicited invitationsand to their subsequent loss of money or personal information.

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