Insights Into Mail Fraud Come From Scammers’ Own Records

Most research into financial fraud relies on victims to recall and report their own experiences, but it is difficult to know whether self-reporting offers a reliable account of these crimes. For a different perspective on the harms caused by fraud, the National Institute of Justice funded researchers at RTI International to analyze data from the other side of scams - the scammers' own digital records about their victims.

Seized by the U.S. Postal Inspection Service, the four scammer databases studied by RTI include information on more than 1.3 million victims across nearly two decades, enabling "the largest analysis of repeat mass marketing fraud victimization to date."[1]

There has been inconsistent evidence about whether financial fraud has an outsize impact on one particularly vulnerable group: older adults.[2] The NIJ-funded study of scammers' own data offers a definitive conclusion: Compared to younger victims, older victims suffered more incidents of mail fraud and lost higher amounts of money.

Age and Fraud Victimization

The data recovered by the Postal Inspection Service came from four mail scams operating between 1999 and 2018. Two of the scammers used fraudulent sweepstakes and lotteries to solicit money from victims, while the others offered fraudulent psychic readings.

Each scam kept a database of its victims, similar to the software used by legitimate businesses to track their customers.[3]

By linking identities across the scammers' databases,[4] the researchers built a combined dataset of 1,383,755 victims involved in 11,870,085 unique fraud incidents.[5] Next, they focused on a subset of 960,295 people who had provided their date of birth to one of the scammers.[6] Knowing these victims' ages allowed the researchers to draw conclusions about mail fraud's effects on people from age 18 into their 90s.

The researchers' first question was whether older adults were more likely than younger adults to be victims of mail fraud, and the short answer was yes.

Describing the relationship between age and victimization, they wrote that "[t]he average age of victims at the time of their first victimization in our data is 61 years old and nearly a third (32%) were more than 70 years old."[7] Most mail fraud victims (57%) were already at least in their 60s when scammers first successfully targeted them.

Individuals in their 70s and 80s suffered more victimization events and lost proportionally more money than individuals under age 70. Losses peaked among individuals in their 80s, who represented fewer than 15% of the victims but nearly 30% of the money lost (see exhibit 1).

Older individuals were also more likely to be defrauded by more than one scammer, even after adjusting for the effect of having more prior victimizations.[8]

Exhibit 1. Victim Age at First Victimization, Losses, and Victimization Incidents

One potential weakness of the data is that researchers could count only the number of completed victimization incidents, in which a victim sent money to a scammer. The dataset did not provide a picture of attempted victimizations, including solicitations that did not receive a response. Therefore, the "data do not indicate if older adults are being systematically solicited more frequently or by more scam types than younger adults."[9] If older adults receive more scam attempts in their mail, this could be a partial explanation for their greater victimization risk.

Understanding Repeat Victimization

Sixty-two percent of victims experienced more than one fraud incident, with an average of nine incidents per person overall.[10] To examine repeat victimizations in more depth, the researchers asked a second question: If you become a victim of mail fraud once, how likely are you to be victimized again in the future?

The answer, they found, depended on victims' age. Once again, older adults were at higher risk.

Compared to victims in their 50s, victims in their 70s and 80s were 9% more likely to be defrauded again. In contrast, the youngest victims in the dataset (ages 18 to 29) were 24% less likely than those in their 50s to experience another victimization.[11]

Repeated victimization is also significant for the magnitude of the crimes involved. Victims lost an average of $251 total per person. Individuals who experienced the most repeat victimizations (more than 20 instances of fraud) accounted for fewer than 1 in 10 victims, but this group's losses were much higher, with "an average of $1,771 [lost] per person, totaling more than $216 million: 62% of the scammers' revenue"[12] (see exhibit 2).

Exhibit 2. Proportion of Repeat Victims and Proportion of Total Losses

Despite these disproportionate total losses, the researchers found that the amount lost in each incident did not tend to rise over time. In the psychic scams, people with multiple victimizations sent on average about 50% more money the second time ($32) than they sent the first time ($20). However, subsequent losses after the second incident stayed about the same, even for those victimized 20 or more times.

The average losses for sweepstakes and lottery scams were lower, remaining around $23 per incident regardless of the number of victimizations.[13]

Although monetary losses per incident were consistent, the researchers observed an acceleration in the incidents' timing: "The more times a victim responded to mail scam solicitations, the shorter the interval became between victimization incidents"[14] (see exhibit 3).

Exhibit 3. Days Between Consecutive Victimization Incidents for Psychic and Sweepstakes/Lottery Scams

Victims who had already been defrauded many times were scammed more frequently. Across both scam types, the second incident occurred 201 days on average after the first. But for victims who experienced more than 20 instances of fraud, the average time between these later incidents shrank to 20 days.[15] However, the average time between victimizations was about 60 days longer for psychic scams than for sweepstakes scams.[16]

Patterns of Fraud

The data shed light on scammers' operations as well as their victims.

The researchers observed a clear seasonal trend in a typical year (see exhibit 4). "March was the peak month for mail fraud, at about 17% higher than the average," they noted. "The months of October through December represent the low season, with November being the lowest at about 11% lower than average." They posited that victims may respond less to scam attempts at the end of the year because they are "saving money during the holiday season."[17]

When the scammers recorded payment types, the most common were checks and money orders. Just over half (54%) of all payments to one of the sweepstakes scammers were made by check.[18]

Exhibit 4. Seasonal Variation of Mail Fraud Incidents

This NIJ-funded analysis of scammers' records reveals a clear trend: Older adults are disproportionately affected by mail fraud. These data highlight that individuals in their 70s and 80s not only face higher risks of becoming fraud victims but also suffer significantly more in terms of total losses. These insights provide a clearer understanding of the dynamics of mail fraud and its impact on vulnerable populations, emphasizing the need for continued research in this area.

About This Article

The work described in this article was supported by NIJ award number 2019-R2-CX-0053, awarded to RTI International.

This article is based on the grantee report "Mass Marketing Elder Fraud Intervention" (pdf, 144 pages), by Lynn Langton, Edward Preble, Daniel Brannock, and Erin Kennedy.