By Kelsey Havemann
In the U.S, fraudsters tricked roughly 880,000 people out of more than $12 billion in reported scams in 2023. In terms of financial impact, that number is clearly staggering. However, the FTC reports that the rate of people under the age of 20 falling for scams is the highest of all groups. A 2024 study by Social Catfish, a company that verifies online identities using reverse search technology, reported that teens and children show the largest percent increase (nearly 2,500 percent) in money lost, from 2017–2022.
Teens crave independence. Surfing and exploring online can fulfill that desire. But scammers are masters at targeting teens’ emotional vulnerabilities. The top scams victimizing those under 20 in 2023 all stem from use of the internet. Here’s how these work and tips for teens to avoid becoming victims:
Social media influencer scam. Those who surf social media platforms most likely have their favorite “influencers,” whose create content often and have gained a significant number of followers. Scammers will create fake influencer accounts then host contests of sorts and ask the “winners” to provide their bank information to receive prizes.
The best defense to combat this scam is to stress to teens to never send anyone their bank information, where they did not initiate the action. It’s helpful to remind them that fake accounts will likely have fewer followers than the true influencer and sending money to someone they have not personally met is never a good idea.
Romance scams and sextortion scams. While different in nature, these prey on susceptible youth searching for that perfect match, someone who just makes them feel good about themselves. Romance and sextortion scammers hook the innocent with fake pictures and profiles luring targets into relationships. When the relationship is established, the romancer will discuss being in a situation and needing financial help to resolve it. After the money is sent, the fraudster ghosts the person.
The sextortion scammer quickly cultivates a hot and sexy relationship and shares explicit pictures. Then the scammer asks for pictures in return, but once received, scammers then threaten that they will post or share those pictures with family, friends and online unless an amount of money is paid. Teens panic and will typically pay to avoid embarrassment and scrutiny. The psychological impact of these scams can be devastating, especially for this age group. There have been cases of teen suicide and long-term anxiety and depression among those victimized.
Communicating with teens about the importance of being able to physically meet or live video chat with a romantic interest is crucial. If they find themselves interested in a person they have not met, remind them to do their own online search and confirm their identity. If they can’t find them and their love connection won’t meet, no matter the excuse, the person is fake. And please, ferociously express that sharing explicit photos is never a good idea, even with someone you have met.
Online gaming. If you are not a gamer, you may not realize that within most online games there are opportunities to make in-app purchases to enhance your game play. Scammers are tricking players by getting their credit card (or their parents’ credit card) information for rewards that do not exist.
Online shopping. These scammers create fake websites that look and feel just like any other online store and offer popular items at a discount. The purchaser buys their items, and they never arrive. By the time it’s realized that it was a fake store, credit card or bank information has been hijacked and will be used for future theft.
Sharing with kids and teens about commonalities of fakes online can help. Key elements are numerous typos and unusual grammar (although as scammers ramp up their use of ChatGPT and other generative AI tools, this may not be an easy giveaway for much longer). Check the website’s customer service information. If the email is a gmail or yahoo email instead of a business email, the site is most likely fake. A quick back search for the store online or double checking directly with the game’s website for available in-app purchases before buying anything from either can reveal a fake.
Teens are teens. They long to be adults. And despite their claims to be fully capable of independence, they still lack life experience. Open communication and education with mindful, real examples are the best steps in demonstrating that scams and fraud can happen to anyone. Often, that communication is better received when it’s not from a parent.
As a banker, leading these types of financial literacy discussions can be more impactful and engaging than a typical lesson. The ABA Foundation has new fraud lessons for teens debuting this fall and more scam-protection resources for all ages within our Financial Literacy programs. Register for free access to everything at ABA.com/FinEd and help make a difference!
Kelsey Havemann is senior manager for youth financial education for the ABA Foundation.
