PENSACOLA — The stereotype of the “little old lady” as scam victim is wrong, and Millennials are actually more vulnerable to scams than Baby Boomers.
That’s the conclusion of new research by the BBB Institute for Marketplace Trust.
Marketplace scams affect one in four North American households each year at an estimated loss to individuals and families of $50 billion, yet most consumers believe they are not vulnerable.
“This research is so vital, not only to stop scammers from hurting consumers, but to help businesses,” said Mary E. Power, president and CEO of the Council of Better Business Bureaus. “That $50 billion ‘underground’ economy is stealing from the legitimate marketplace. Every dollar lost to a scam is a dollar not spent at a lawful, trustworthy business.”
The research, “Cracking the Invulnerability Illusion: Stereotypes, Optimism Bias and the Way Forward for Marketplace Scam Education,” is based on a survey of more than 2,000 adults in the U.S. and Canada.
Participants were asked about their perceived vulnerability to scams, who they think is most likely to be scammed, and about factors that helped them to avoid being scammed. They did not know that BBB was the survey’s sponsor.
“We’ve bought into stereotypes about scam victims — they’re usually seen as vulnerable and elderly, or gullible and poorly educated,” noted the paper’s co-author Emma Fletcher, product manager with the BBB Institute, CBBB’s foundation. “These stereotypes are strongly held … and they are wrong. We are all at risk, but younger and more educated individuals are actually the most likely to be scammed.”
“Optimism bias — the idea that we all think other people are more vulnerable than we are — is associated with risk-taking and failure to heed precautionary advice,” said co-author Rubens Pessanha, CBBB director of marketing research and insights. “Seniors may be the one group that does not suffer from optimism bias when it comes to scams. They’ve heard, loud and clear, that they are at risk. Seniors may very well be more scam savvy than others. They are also less impulsive buyers than younger consumers, and less likely to be making purchases online where so many scams take place.”
The new research also confirms some trends noted in BBB Scam Tracker, a crowd-sourced reporting tool. More than 30,000 consumers have reported details of scams to BBB since the site was launched in late 2015, and reports are shared with law enforcement to drive investigations.
Of those consumers reporting scams to BBB Scam Tracker, 89 percent of seniors (age 65 and up) recognized the scam in time, while only 11 percent reported actually losing money.
For those age 18-24, however, more than three times as many failed to recognize the scam — 34 percent reported losing money, according to the survey.
This article originally appeared on Crestview News Bulletin: Research shows millennials more likely to get scammed than boomers