Contact and Payment Methods Used for the Top Five Categories of Scams

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Over the past several years, U.S. consumers have been increasingly exposed to scams. Although the total number of fraud reports received by the Federal Trade Commission (FTC) increased by only about 14 percent from 2020 to 2024 (from 2.4 million to 2.8 million reports), the reported loss amount grew more than threefold over the same period—from $2.6 billion to $8.9 billion. The top five categories of fraud based on loss amount were all related to scams: investment scams, business and government imposter scams, romance scams, and online shopping scams. Consumers reported that fraudsters contacted them using various methods, from mail and phone call to social media. Defrauded consumers reported paying fraudsters with payment methods ranging from cash and check to cryptocurrency. In this Payments System Research Briefing, we examine whether contact and payment methods vary across the top five scam categories and how these methods have evolved over time.

Top five scam categories from 2020 to 2024

We analyze the top five scam categories based on fraud report data from the FTC. The data comprises over 14 million fraud reports submitted by consumers and small businesses to the FTC and other data contributors (such as state and federal government agencies) from 2020 to 2024. For each report, we observe the fraud category, the date of report and, if reported, the loss amount, payment method, and contact method.

From 2020 to 2024, the top five scam categories in loss amount were the same each year: investment scams, business imposter scams, government imposter scams, romance scams, and online shopping scams.^_ These categories accounted for a sizable share of all reported losses from fraud: 42 percent in 2020 and around 60 percent from 2021 to 2024. Chart 1 shows that the loss amount grew in all five categories from 2020 to 2024, though at different rates.

Chart 1: Dollar amount lost to scams has increased, especially for investment scams

Among the top five scam categories, investment scams (light blue line in Chart 1) are the fastest growing. Losses from these scams grew almost twelvefold from $202 million in 2020 to $2.4 billion in 2024, making them the top category since 2021. Investment scammers convince consumers to invest in an opportunity, promising large returns with minimal effort, and then disappear with the consumer’s money. For example, in cryptocurrency investment scams, scammers claim they can show consumers how to make big money by investing in cryptocurrency and then direct the consumers to a fake website or app to make their investment (FTC 2023b).

Business imposter scams (purple dotted line) and government imposter scams (green line) are the second and third fastest growing categories, increasing roughly fivefold since 2020. They were ranked second and third in loss amount in 2024. In imposter scams, scammers deceive consumers into sending them personal information or money by pretending to work for a company or government agency. In business imposter scams, scammers often send messages about (fictitious) suspicious account activities or charges that require payment to fix, or about fake discounts and giveaways that require payment to claim (FTC 2024). In government imposter scams, scammers may pretend to be from the Social Security Administration or Internal Revenue Service, informing consumers they need to make a payment immediately to avoid losing their benefits or pay taxes they allegedly owe immediately to avoid facing consequences such as arrest or deportation (FTC 2023a).

Romance scams (dark blue dashed line in Chart 1) and online shopping scams (light purple line) have had smaller growth rates; the loss amounts doubled for romance scams over 2020–24 and less than doubled for online shopping scams. These were the top two categories in loss amount in 2020 but the fourth and fifth in 2024. In romance scams, scammers use fake identities (often pretending to be individuals located overseas) to build online romantic relationships with consumers and then leverage their trust to obtain personal information or money. Scammers typically request money for a plane ticket or visa, for medical expenses, or for easing financial hardship (FTC 2022a). Online shopping scams are related to product sales via online shopping, commonly involving the non-delivery of orders: defrauded consumers never receive products they ordered and paid for (FTC 2022b).

These five categories of scams also make up a sizeable share (around 40 percent) of the total number of reports received by the FTC between 2020 and 2024. Online shopping, business imposter, and government imposter scams were consistently among the five most common scams. The most common scam category in 2020 and 2021 was online shopping scams but since 2022 has been business imposter scams (with 451,000 reports in 2024). Investment scams have been the twelfth most common scams since 2021, and romance scams have been the fourteenth or fifteenth most common scams, the lowest ranked among the five categories (with 44,000 reports in 2024). From 2020 to 2024, the number of reports fell slightly for online shopping scams but increased moderately for the other four categories, between 1.3 times (for romance scams) and 3.8 times (for investment scams).

Share of reports with a loss amount above zero in all reports across the top five scam categories

Among all fraud reports, only a subset has a loss amount above zero. Some consumers report a loss amount of zero or do not provide the loss amount, which most likely indicates that they did not pay the scammers.^_ Thus, the share of reports with a loss amount above zero may better reflect how likely consumers are to be defrauded when they encounter a scam.

Chart 2 presents the share of reports with a loss amount above zero across the top five scam categories (in loss amount). The share is substantially higher for investment, romance, and online shopping scams (60 percent or higher) than for business and government imposter scams (around 20 percent or lower), suggesting that consumers are more likely to be defrauded when encountering certain types of scams.

Chart 2: Share of reports with a loss amount above zero is substantially higher for investment, romance, and online shopping scams

Contact methods across the top five scam categories

The contact methods used by the scammers may explain why the share of reports with loss amounts above zero is higher for certain scam categories than others. Scammers may use different contact methods across scam categories, and consumers’ susceptibility to scams may vary by contact method. Certain contact methods may make scams more convincing, as scammers may be better able to leverage technologies such as AI when using them, or consumers may not expect scammers to contact them with those methods and thus be less suspicious. The contact methods in our data (excluding “other”) can be divided into two groups: “traditional” methods, which include mail, phone calls, emails, and text messages; and “new” methods, which include social media, online ads, pop-ups, websites, and mobile apps.

To examine whether the likelihood of consumers paying scammers when encountering a scam varies by contact method group, we compare the share of reports with a loss amount above zero for each contact method group across the top five scam categories. Chart 3 shows that for all scam categories, this share is higher for new methods (purple bars) than for traditional methods (blue bars). This finding suggests that consumers may be more susceptible to scams perpetrated through social media and other web- or app-based methods than through traditional methods.

Chart 3: Share of reports with a loss amount above zero is higher for new contact methods than for traditional methods across all top five categories

To examine whether the use of either contact method group varies across the top five categories, we divide the reports by contact method group. Chart 4 shows that the two contact method groups make up significantly different shares of reports across the categories. Traditional contact methods (blue areas) are used for a substantially larger share of business and government imposter scams, while new contact methods (purple areas) are used for the largest share of investment and romance scams. New methods are also used much more often than traditional methods for online shopping scams (40 percent versus 7 percent, respectively, in 2024).

Chart 4: New contact methods are often used for investment, romance, and online shopping scams, while traditional methods are often used for imposter scams

Within each scam category, the shares for each contact method group have also changed over time. The share of scams perpetrated through new contact methods has grown from 2020 to 2024 across all five categories, while the share using traditional methods decreased for all but the investment scam category. Together, these changes indicate a general shift by fraudsters toward social media and other web- or app-based methods to reach consumers.

Scammers’ greater use of new methods to contact consumers for online shopping, investment, and romance scams, combined with consumers’ higher susceptibility to scams perpetuated through these new contact methods, suggest that contact methods at least partly explain why consumers are more likely to pay the scammers when encountering those three categories of scams.^_ The upward trend in the use of new contact methods across all five categories also suggests that consumers may become more likely to fall for scams and pay the scammers in all five categories.

Payment methods across the top five scam categories

Defrauded consumers pay scammers using various payment methods, but in many cases, scammers direct consumers to use a specific payment method that maximizes their chances of obtaining the consumers’ money. Knowing which payment methods defrauded consumers are more likely to use may assist financial institutions and regulators in focusing their scam mitigation efforts. The payment methods in our data can be classified into five groups: 1) payment cards, which include credit, debit, and gift or reloadable cards; (2) payment apps (such as Zelle, PayPal, Venmo, and Cash App); (3) check or cash-based methods, which include checks, money orders, cash, and nonbank money transfers (such as through Western Union and MoneyGram); (4) bank transfers, which include wire transfers, automated clearinghouse payments, and real-time payments; and (5) cryptocurrencies.

To examine how defrauded consumers pay scammers, we divide reports with a loss amount above zero into the five payment method groups. Chart 5 shows that these groups’ shares of reports vary across the top five scam categories. For investment scams, cryptocurrencies (light purple areas) are the most common payment method (used in 40 percent of investment scams in 2024), which may be due to the frequency of cryptocurrency investment scams. For romance scams, check or cash-based methods (light green areas) are most common (35 percent in 2024). Among these methods, money transfers by nonbanks have been especially common, possibly because these scams often hinge on a “love interest” living or working overseas. For the other three categories, cards (light blue areas) are the most common payment method. In 2024, the share of cards used to pay scammers was 50 percent for business imposter scams, 47 percent for government imposter scams, and 32 percent for online shopping scams.

Chart 5: Cryptocurrencies are often used in investment scams, check and cash-based methods are often used in romance scams, and cards were often used in the other three categories

The payment methods scammers prefer are likely to change over time in response to evolving payments and regulatory landscapes. All or most of the top five scam categories show some similar trends in payment methods. Across all categories, check or cash-based methods make up a decreasing share of reports. The share of cards also declined across all but the romance scam category.^_ In contrast, the shares of bank transfers, cryptocurrency, and payment apps increased across all but the online shopping scam category. Our findings suggest that scammers’ preferred payment methods have shifted from traditional to newer methods. This trend may be driven by the increased availability of Bitcoin ATMs, which facilitate payment via cryptocurrency, and the growing popularity of payment apps among consumers (Fletcher 2024; Noll 2023).

We also examine how the loss amount is divided across the five payment method groups because the average loss amount per report varies significantly depending on payment method. For example, in 2024, the average loss amount per report (with a loss amount above zero) was the highest for bank transfers ($44,000), followed by cryptocurrencies ($30,000) and check or cash-based methods ($14,000). The average loss amounts for cards and payment apps were much lower ($3,000 and $4,000, respectively, in 2024).

The share of the total loss amount attributable to each payment method group varies across the five categories. As Chart 6 shows, between 2020 and 2024, the payment method group that accounted for the highest share changed from cryptocurrencies (light purple) to bank transfers (dark blue) for investment scams and from check or cash-based methods (light green) to bank transfers for business imposter and romance scams. For government imposter and online shopping scams, check or cash-based methods and cards (light blue), respectively, had the highest share in both 2020 and 2024, but bank transfers became a close second in 2024.

Chart 6: Bank transfers made up the highest or second highest shares in loss amount across all top five scam categories in 2024

Notably, Chart 6 shows that the share of bank transfers in loss amount increased across all five categories. The share increase is especially sizable for investment scans (which more than doubled from 2020 to 2024) and business imposter scams (which nearly doubled). Other trends are the same as those observed in the shares of payment methods by number of reports (see Chart 5): The share of check or cash-based methods declined across all five categories; the share of cards declined for all but the romance scam category; and the shares of cryptocurrency and payment apps, respectively, increased for all but the online shopping scam category.

Conclusion

Over the past several years, the amount of money U.S. consumers have lost to scams has grown sharply. Although the contact methods and payment methods used for these scams vary across the top five scam categories, we see some common trends. Scammers have increasingly used social media and web- or app-based methods to contact consumers, and these methods have been associated with higher likelihoods of scam victimization. Defrauded consumers have increasingly used cryptocurrencies and payment apps to pay scammers. And the loss amount defrauded consumers incur through bank transfers has increased significantly.

These trends have implications for scam mitigation efforts. Social media and digital platforms have important roles to play in stopping scams, as scammers increasingly use social media and web- or app-based methods to contact consumers. Financial institutions and other payment service providers may need to develop and adopt mitigation tools that identify scams quickly and intercept payments before they reach scammers, as scammers may increasingly target newer payment methods, including real-time payments and payment apps. The U.S. payment industry may be able to draw lessons from other countries (such as the United Kingdom) in tackling real-time payment scams (Toh 2024). State and federal governments also play an important role—for example, by implementing regulations for Bitcoin ATMs to mitigate the use of cryptocurrency for scams (Bitcoin Depot 2024a, 2024b, 2024c). Up-to-date information on the contact and payment methods putting consumers most at risk of falling victim to scams can help direct timely and effective efforts in mitigating scams.