Wednesday, June 07, 2023

Lloyd's bank warns that two thirds of the scams they see start on Facebook or Instagram

Israeli agent drowned in Italian boat accident was part of mission targeting Iranian weapons: Media report Anadolu Agency. “Senseless, accidental if you believe in accidents…” –Thomas Pynchon, Gravity’s Rainbow. Read all the way to the end.

Lessons from Washington State's New Capital Gains Tax (which brought in $600 million *more* than projected over a single year). "Our state's richest residents are much, much richer than we understood..."

BBB updates study on employment/job scams; complaints increased 250% over last year

60 Minutes US looks at grandparent scams and other online scams, especially those aimed at  older victims

Los Angeles: Chinese woman arrested for shipping thousands of packages that were internet orders from Chinese companies with counterfeit postage from postal meters; cost USPS $60 million

49 State AG’s sue Avid Telecom, allege it is responsible for billions of illegal robocalls
Consumer Federation of America list of top ten fraud in 2022; complaints to State and local consumer agencies; auto repair tops the list

Myth #7:  One of the best ways to prevent fraud crimes is to teach financial literacy.  By Anthony Pratkanis
Financial literacy refers to fundamental concepts of finance and is typically measured with quizzes about compound interest, asset diversification, bond pricing, etc.  An oft-heard claim is that financial literacy is a protective factor in fraud victimization and thus an important intervention tactic.  There is no scientifically-valid evidence for this claim.
Knowing that bond prices fall as interest rates go up is of little relevance in recognizing and responding to romance fraud, lottery scams, government impostors, grandparent schemes, and the like.
However, what about investment fraud?  In a 2006 study, my colleagues and I found that verified investment fraud victims had significantly higher financial literacy than non-victim investors. This finding was replicated in 2014 by Graham of UK’s FCA and again in 2017 by Kieffer and Mottola of FINRA.  Some of the most sophisticated investors have been fraud victims:  Jay Gould, CalPERS, JPMorgan Chase, Sequoia Capital, Rupert Murdoch, Blackrock, Y Combinator, Andreessen Horowitz, and Wells Fargo former CEO Richard Kovacevich, to name a few. 
Why this finding?  Knowing the value of a diversified portfolio is of little use in recognizing pump and dumps, Ponzi schemes, and entrepreneurial fraud. It is like knowing the rank of poker hands without knowledge of coolers, seconds, mucks, and other forms of cheating.  Active investors will gain financial literacy through their activities and will also be more likely to encounter con grifters who infiltrate the financial system.  And, as always, a con criminal will use the target’s knowledge (and lack of knowledge) to tailor the pitch for best effect.
The good news:  While financial literacy is of little value in fraud prevention, teaching about fraud schemes, as my colleagues and I first showed, effectively reduces victimization.
All myths collected here

Fraud Studies: Here are links to the studies I’ve written for the Better Business Bureau: puppy fraudromance fraud; BEC fraudsweepstakes/lottery fraud,  tech support fraudromance fraud money mulescrooked movers, government impostersonline vehicle sale scamsrental fraud, gift cards,  free trial offer frauds,  job scams,  online shopping fraud,  fake check fraudand crypto scams
Fraud News Around the world
Humor                                                                               FTC and CFPB  Virus Benefit Theft Social mediaBusiness Email compromise fraud RansomwareData Breaches ATM SkimmingJamaica and Lottery FraudRomance Fraud and Sextortion