The payments industry now has a new tool to improve scam reporting, detection and mitigation. Released in summer 2024, the ScamClassifierSM model supports consistent and detailed classification, reporting, analysis and identification of scams, attempted scams and related trends.
The Federal Reserve and a work group of payments and fraud experts developed the ScamClassifier model because scams are growing in both prevalence and severity. For example, more than $10 billion (Off-site) in 2023 consumer fraud losses were reported to the Federal Trade Commission, a 14% increase from 2022. Investment scam losses were the largest category, up 21% from the previous year to more than $4.6 billion. As another example, scammers pose as legitimate entities to solicit payments through techniques that include business email compromise (BEC, Off-site), which is classified as part of the business impostor scam type. BEC complaints to the FBI’s Internet Crime Complaint Center (Off-site) rose 7% in 2023, to 21,489 complaints totaling $2.9 billion in reported losses.