Kiwis reported $33m in losses to online scams last year, triple 2017 total - Netsafe

Kiwis reported $33 million in losses to online scams in 2018, Netsafe's latest review has revealed. It's the highest amount in the organisation's 20-year history.

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The online safety organisation’s Martin Cocker explained how scammers are “getting better at their job”. Source: Breakfast

In a report released today, Netsafe said New Zealanders reported 13,000 instances of online scams and fraud last year to the online safety organisation - a drastic increase from 2017, when 8100 reports were made totalling $10.1 million in losses.

"The scammers are getting better at their job," Netsafe CEO Martin Cocker told TVNZ1's Breakfast this morning. "There was some big scams last year that people sort of know about and, unfortunately, those scams were effective." 

Mr Cocker said in statement today, "We know the lengths that scammers are taking to deceive New Zealanders and we know that existing interventions are having a limited effect.

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New Zealanders lost a record $33 million in cyber scams last year. Source: 1 NEWS

"This is an issue that isn't going away. More needs to be done or we will continue to see large numbers of New Zealanders suffering financial and psychological harm."

January to March 2018 was the period with the most reported losses at $12.5 million - around double the $6-7 million in losses reported in subsequent quarters. The average loss increased from $10,771 in 2017 to $21,140 in 2018.

The smallest loss reported was $1, and the largest at $5 million, they said.

"Last year, the two big waves that came through - there's one that's referred to as the Countdown scam, or supermarket scam that's using supermarket brands targeting New Zealanders. And then there was the 'sextortion' scam where you received an email saying they had video of you doing something embarrassing and you had to pay up," Mr Cocker explained on Breakfast.

"I think the first one was effective in terms of getting money. The second one was effective in terms of unsettling New Zealanders."

Invoice scams, investment fraud and romance scams were among the scams that resulted in the biggest losses for Kiwis.

Netsafe said the reports they receive represent a small fraction of actual losses, with many victims "getting lost in a fractured support network, confused about where to report, feeling embarrassed about being tricked or disillusioned about the point of reporting".

"At the moment, there is no official 'one-stop-shop' that the public can report scams to and rely on for the advice they need. There is no co-ordinated national effort to disrupt scams locally," Mr Cocker said.

"New Zealand needs a national response centre to provide real-time scam trend analysis, information sharing, nationwide alert systems and dedicated support."

In response to the report, the fraud education arm of the Commission for Financial Capability voiced support today for a centralised agency to combat the rise in online scams. 

"The system is fractured with a number of agencies covering different types of fraud and few providing support for victims," the commission's fraud education manager, Bronwyn Groot, said in a statement.

"A central point could provide a rapid response to reports to stop money going overseas, help enforcement to track offenders and provide a wrap-around recovery plan for victims and their families."

Ms Groot also cited the "emotional toll" on victims of online scams as a reason to establish a centralised agency. 

"Fraud is not just about financial loss. It takes a long-lasting emotional toll that affects their psychological wellbeing. Victims need somewhere to go where they feel safe and confident that they will be supported and action will be taken to investigate the fraud they've been subjected to.

"It's not just about stopping millions of dollars being siphoned overseas every year, it's also about looking after the wellbeing of Kiwis who have these offences committed against them."

Netsafe has released the following tips for spotting online scams.  

Be wary of:
1. Being contacted by phone or email out of the blue
2. Being told there is a problem with your device or internet connections
3. Being asked for the passwords to your online accounts
4. Unexpected communications asking you to “verify” your account or details
5. Winning a competition that you don’t remember entering
6. Moving outside of an online trading or booking website or app
7. Friends/partners you’ve met online asking for money or talking about money problems
8. Unusual payment methods such as gift cards
9. Being asked for remote access to your device
10. Pressure to make a decision or take action quickly