How confidence scams work
Confidence scams, or romance scams, often target seniors over 60 who are experiencing loneliness and isolation, but anyone seeking companionship online is at risk. According to the Nasdaq’s 2024 Global Financial Crime Report, nearly 854,000 people reported confidence scams last year, with losses totaling $4 billion. Often, those figures include the victim’s entire life savings and likely underrepresent the full impact, as many victims do not report incidents due to shame or embarrassment.
Fraudsters create fake profiles on dating apps and social media platforms, using stolen images and fabricated stories to build relationships with their targets. They shower victims with attention and affection, often avoiding video calls or in-person meetings by claiming to be deployed in the military or working overseas. Once trust is established, they invent urgent financial crises—medical emergencies, family hardships, or travel expenses—to manipulate victims into sending money. The requests start small but increase over time, leaving victims emotionally and financially devastated. These criminals are incredibly patient.
Beyond romantic entanglements, scammers also exploit friendships and caregiver relationships. One particularly devastating variation of the confidence scam is "pig butchering," a scheme in which scammers lure victims into fraudulent investments, most often in cryptocurrency, before disappearing with their funds. “It’s a sophisticated con, and you can see that because it’s a long-term con,” said James Barnacle, who runs the FBI’s Financial Crimes Section. In fact, according to Barnacle, there were well over $3.5 billion of reported losses due to this type of fraud in 2023 and around 40,000 victims in the United States. He's even seen losses as large as $4 million.
