Identity Fraud in Focus quarterly report for Jan - Mar 2022

Read our report to discover:

3 emerging scams and how to protect yourself

Top identity theft and fraud crimes for Jan - Mar 2022

An alarming rise in medical fraud to keep an eye on

3 emerging scams and how to protect yourself

Spam texts and phone calls are a problem

If it seems like you’re receiving more spam texts and calls than normal, you probably are. New data shows Americans received nearly 42 spam texts on average in March. And despite a new FCC regulatory framework, spam calls increased 32% to 72.2 billion in 2021.¹ These tactics aren’t just annoying, but they’re effective: Last year Americans reported losing $131 million to fraud schemes initiated by text, a jump of more than 50% from the year before, according to data from the FTC.² And while our new study shows that 60% of respondents have some kind of protection against spam/scams, many rely on basic features like spam alerts that come pre-installed on their devices, and are not seeking additional layers of defense.³ Fraudsters continue to find new ways to steal money, and it’s more important than ever to stay vigilant.

Charity scams are on the rise

Fraudsters try to take advantage of crisis situations to steal money or sensitive personal information. Whether it’s a natural disaster, a global pandemic, or geopolitical unrest (such as the humanitarian crisis caused by Russia’s invasion of Ukraine), criminals will launch new charity scams to exploit your generosity. But with a few precautions and a little research, you can help ensure your donation goes to the right place.

Peer-to-peer (P2P) payment service scams are surging

As payment speeds increase, so do scams. That’s why peer-to-peer payment services like Zelle, Venmo, and Cash App, which allow users to quickly send money, are popular targets of scammers. Because these transactions don’t carry the same consumer protections as credit card fraud, and users authorize payments ahead of time — often with just a tap or a swipe — banks typically don’t reimburse victims. So once a payment is made, it’s gone forever. Despite this growing issue, people aren't taking it seriously enough, which could lead to even higher risk.

“We hear stories regularly from people who were scammed out of their nest eggs," says Allstate Identity Protection Director of Customer Care Brian Stuart. “It breaks your heart, especially when vulnerable populations are taken advantage of, because these losses aren’t typically covered. We'll continue to resolve fraud cases for members, but it is almost as important to educate and empower them to recognize scams before they become victims.”

What we saw in the first quarter of 2022

Cybercrime is still flourishing. Over the past year, Allstate Identity Protection has seen a 121% increase in fraudulent credit and/or loan inquiries and a 21% spike in new account fraud. There’s also been a 7.45% surge in government benefits fraud, led by criminal disability filings in California. We expect disability fraud cases will continue to rise in quarter two, due to last-minute tax filers, so we’re not out of the woods yet.

*normalized to account for total subscriber growth

An alarming new fraud trend to keep an eye on

We’ve seen a 66% uptick in medical fraud in the past year. This is when a criminal uses stolen personal info to get medical treatment, prescription drugs, or surgery in a victim’s name. Our overall case numbers are relatively low, but what makes this trend alarming is, unlike other crimes we see, medical fraud takes much longer to detect. For example, if someone opens a bank account in your name, our credit monitoring service will alert you in near-real time. But you might not see a fraudulent medical bill until you’ve reached your benefit limit. This could delay important treatments. 

Federal law also generally limits consumers’ liability for fraudulent credit card charges to $50,⁴ but with a stolen medical identity, those protections aren’t in place. In addition, healthcare data typically contains more personal identifiable information than a traditional financial breach. That’s why healthcare info is more valuable on the dark web than credit card numbers.⁵

Finally, medical fraud is often more dangerous because it can create errors in a victim’s patient records. This could lead to a misdiagnosis.

“The healthcare industry is particularly vulnerable to fraud. Often, patient files need to be shared with third-party vendors across a number of systems and devices — some of which are outdated and lack sufficient protection,” said Allstate Identity Protection Vice President of Product Lewis Bertolucci. “That’s why our fraud-detection tools, like dark web monitoring with fast alerts, provide an important layer of defense. With digital fraud, every second counts.”