Key facts
- Scams in the U.S. have surged to a record high, with reported losses reaching $15.9 billion last year.
- Victims often face additional financial burdens, including taxes on stolen funds and bank fees.
- The Tax Cuts and Jobs Act provision means personal losses from many common scams are not eligible for tax breaks.
- An investigation tracked funds from a victim to a scam compound in Myanmar, which has since been dismantled.
- Most scam victims are too embarrassed to report crimes, leading to an estimated $200 billion in actual losses in the U.S.
- The U.S. is criticized for lagging in holding companies responsible and regulating cryptocurrency used by scammers.
Scams in the United States have reached unprecedented levels, with victims losing billions of dollars annually and often facing further financial and emotional distress. An investigation by The Associated Press and FRONTLINE revealed that despite the surge in fraudulent activity, many victims receive little to no assistance from authorities, and some even incur additional costs through taxes and fees on the stolen money.
One victim, identified as Simon, lost $800,000 to an online scammer posing as a companion after his wife's death. He was left with significant debt and taxes on the lost funds, and his attempts to report the crime to local police and the FBI were unsuccessful. He was later contacted by another scammer offering to help recover his losses for an additional fee.
The scale of the problem is staggering, with Americans reporting a record $15.9 billion in losses to the Federal Trade Commission in the past year, a 25% increase. The FTC estimates actual losses could be closer to $200 billion, as many victims are too embarrassed to report the crimes. The investigation found that 98% of Americans suspect they have been targeted by scammers, and three in 10 have personally lost money or information.
Advances in artificial intelligence and cryptocurrency have fueled the rise in sophisticated and hard-to-trace scams. The AP/FRONTLINE investigation tracked funds from Simon's case to a scam compound in Myanmar, which has since been largely dismantled by local authorities, though operations have reportedly relocated. Victims interviewed expressed feelings of isolation, shame, and neglect from law enforcement and the government, with some even contemplating suicide.
Furthermore, a provision in the Trump administration's Tax Cuts and Jobs Act, made permanent in 2025, means personal losses from many common scams are not eligible for tax breaks, forcing victims to pay taxes on money that was stolen from them. This exacerbates the financial hardship already faced by those who have been defrauded.