New Federal Trade Commission rule aims to stop impersonation scams

COLUMBIA, Mo. (KMIZ)

A rule has gone into effect this week that will allow Federal Trade Commission to crack down on scammers impersonating government agencies or businesses.

FTC data shows impersonation scams cost people more than $1.1 billion in 2023.

This new Impersonation Rule will give the FTC stronger tools to combat and deter impersonation scammers, according to a release. The rule will allow the FTC to file federal court cases to force scammers to return the money they made through government or impersonation scams.

"We're hoping that the rule will have a sort of market-wide impact on deterrence of these particular scams, particularly because what we have now is the authority to return money back to consumers," said FTC Attorney Christopher Brown.

The FTC can take scammers to court that have used government seals or business logos, spoofed government and business emails or web addresses or falsely implied affiliation with a government agency or business.

Brown said business impersonation was the most reported fraud type in 2023 at 330,000 reports. Government impersonation was the third highest, at almost 160,000 reports. Combined, he said the two categories make up nearly half of all frauds reported to the FTC in 2023.

"In 2023, consumers reported more than $1.1 billion of loss to business and government impersonation scams. That's more than three times what consumers reported in 2020," Brown said. "So, this financial loss to consumers is quite considerable."

Data from the FTC shows the top five forms of impersonation scams in 2023 were:

• Copycat account security alerts
• Phony subscription renewals
• Fake giveaways, discounts or money to claim
• Bogus problems with the law
• Made-up package delivery problems

Cole County Sheriff John Wheeler said scammers have been impersonating the Cole County Sheriff's Office for years now. He said his office usually receives reports of these scams about once a month.

"These scammers will call people and say, 'You didn't show up for jury duty and there's a $5,000 warrant for you," Wheeler said. "They're very convincing."

Wheeler said these impersonation scams seem to increase during times when a jury trial is going on in Cole County. He said the scammers will spoof the department's phone number to make the call seem legitimate, and then use the names of real sheriff's office employees.

Wheeler said the sheriff's office won't contact people this way.

"Ninety-nine percent of the time, we dont' call you and tell you you have a warrant. We show up at your house," Wheeler said. "And, we don't let you pay with gift cards. People should be cognizant of that."

He said if someone is unsure if something is a scam, they should hang up and call the sheriff's office directly.

Overall, FTC data shows that while phone calls are still the preferred method of contact for impersonation scams, phone call contacts have been decreasing since 2020. Text messages and email contacts are on the rise.

Bank transfers and cryptocurrency are the top methods of payment.

"The goal is always the same: to try to obtain your money or your personal information by pretending to be someone that you trust," Brown said.

To avoid these scams, the FTC said to slow down and never click on unknown links or respond to unexpected messages. If something seems real, contact the company or agency directly instead of replying to an unknown message.

People should also realize legitimate businesses and government agencies will never ask anyone to buy gift cards, use a Bitcoin ATM or move money to solve a problem.

It's also important for people to report these scams to the FTC and to local law enforcement. Brown said those complaints let the commission know how to move forward.

The FTC is also accepting public comments this month for a proposed rule that would prohibit scammers' ability to impersonate individuals.

Wheeler said while this new rule likely won't stop impersonation scammers, it will definitely help.

"Every little bit helps on that," Wheeler said. "Even if it helps us get one more person and get some restitution from the funds back to the victims, that's what we need to be doing."