Recent research shows that more online scams are affecting millennials (born between the early 1980s and mid-1990s) and Generation Z (born between the mid-1990s and early 2010s) than ever before. In a recent report from Social Catfish entitled The State of Internet Scams 2021, findings reveal that the number of online scam victims aged 20 and younger increased 156% between 2017 and 2020. People aged 18 to 29 are also more likely to become victims of identity theft than any other age group.

Why are young people more vulnerable to online scams?

Picture a typical scam victim. Maybe in the past you'd call to mind an older person, perhaps someone who doesn't fully understand the trappings of the internet. However, the latest data shows that the proportion of younger victims is growing at the fastest rate. The report puts forward a number of possible reasons for this:

• Younger people have grown up with the internet, so they're more comfortable with sharing personal information online.

• Millennials are currently favouring non-traditional payment methods, some of which have fewer built-in fraud protection methods in comparison with traditional credit cards, leaving them more vulnerable to financial scams.

• Most of the latest scams play out on social networking sites such as Facebook, Google Hangouts, Instagram and WhatsApp, where the majority of users are aged 25-34 - falling into the millennial category.

An overview of the latest scams

As of January 2022

Spoofing scams

According to Social Catfish's report, spoofing scams are relatively new but developing quickly. Over US$216 million was lost to spoofing scams in 2020, compared with $0 in 2017. Spoofing occurs when scammers impersonate a legitimate organisation, such as a bank or a utility company. As an example, scammers create an email address that looks like it's from an organisation you trust, but if you look closely you'll see that there's a slight difference in the appearance of the address. The email might come from a non-business account such as a Gmail domain, or there may be a minor spelling mistake in the person or company's name.

This type of scam is called a business email compromise and, according to Social Catfish's report, US$1,87 billion has been lost to this type of scam with each victim losing an average of US$96,372.

Spoofing or impersonation scams can also play out over text messages, for example when a criminal sends a fake SMS from a trusted organisation such as a delivery or retail company. A victim receives a message alerting them to a missed parcel delivery, tricking them into handing over financial or personal information to release the fake package.

Phishing scams

Phishing scammers also impersonate businesses in order to access the victim's money or personal information. For example, they create fake websites that mirror those of real retail businesses and send spoofed emails linking victims to the site. When the target clicks on the link, they buy products that seem to be an amazing deal. In fact, the products never arrive. Social Catfish reports that this type of crime, known as an online shopping scam, generated a loss of over US$265 million in 2021.

Employment scams

Criminals are also running fake online job adverts to target young job-seekers desperate for cash. The victim is asked for personal details or to pay for equipment in order to start a new role. In reality, the job doesn't exist and nor does the equipment. The victim might also receive an "overpayment"that they need to pay back, however the cheque bounces and the victim is left out of pocket.

The number of money mules aged 30 and under has also increased by 80% over the past year as of Oct 2021, according to the crime prevention agency Cifas. Victims are typically targeted via social media sites such as Snapchat or Instagram, with the promise of easy work acting as a local money transfer agent. They're asked to "process"funds through their own bank account and are lured with the promise of a commission. In reality, they're laundering money for criminals and they could face a conviction or fine. At best, the victim's bank account will be frozen and their credit rating damaged. This could mean they find it impossible to get a mobile phone contract or mortgage in future.

How to avoid online scams

It's possible to bypass many of these scams if you take a few precautionary steps. Here are a few ways to make yourself less vulnerable.

Secure your passwords


Times have changed - it's no longer enough to have one strong password that you use for all websites. Hackers have developed new methods of discovering them. You should therefore use different passwords for each account you have, so if one is compromised then you're not exposing yourself to further threat.
You should also change your passwords regularly. If you're concerned about remembering them, you could use a password manager which is an application designed to store and save your credentials securely. Your codes are protected and you only need to remember one - the password for your password manager. Or, if you store passwords on your smartphone, you should activate fingerprint ID or use a secret code to unlock your phone.

Be wary of online stranger danger

Many people you "meet"on the internet are not who they say they are. Scammers pretend to take a number of roles - a potential love interest on a dating app; someone representing your bank; a friend in need asking for money on WhatsApp.

Never hand out information or money without first checking the identity of the person you're speaking with, even if the individual is posing as someone you know. You could ask for a video chat, or if you receive a message from an organisation then you could phone that company to check that the message is valid.

Or, if you're not convinced that a company actually exists, then you could quickly look up their address on Google Maps - if the satellite picture shows an empty field, for example, then you know it's not legitimate.

Keep up to date with the latest online scams

The bottom line here is that no one is immune to online scams - anyone can become a victim whether you're aged 17 or 87. And attacks are becoming more and more complex. Last year alone we witnessed an increase in SMS scams and data theft crimes that target our digital privacy. Fraudsters are targeting every demographic from small business owners to millenials.

That's why it's crucial to stay informed on the latest scam trends. Remember that spoofing scams robbed victims of US$216 million in 2020, whereas no spoofing scams were reported just three years prior in 2017. Sign up to scam alerts from organisations such as the Federal Trade Commission in the US, or Action Fraud in the UK. And, most importantly, if you do fall victim to online fraud then you should report it to your local fraud protection service immediately.

Finally, If you are exchanging money, always use regulated solutions. CurrencyFair is fully licensed and regulated by the Central Bank of Ireland. As a regulated foreign exchange platform, CurrencyFair uses two-factor authentication, encryption via SSL, segregated accounts, thorough verification and multiple other safety measures to ensure all transfers through our service are as secure as possible. See here for full details of our security procedures.

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This information is correct as of 04 January 2022. This information is not to be relied on in making a decision with regard to an investment. We strongly recommend that you obtain independent financial advice before making any form of investment or significant financial transaction. This article is purely for general information purposes. Photo by Sharon McCutcheon on Unsplash.