‘Evolving Scams’: In Maryland, How COVID-19 Pandemic Paved Way for Rise in Fraud Cases

The onset of the COVID-19 pandemic ignited a wave of panic across the country.

As case numbers rose and testing was in short supply in the early days of the emergency, people shuttered themselves at home.

The prolonged isolation crucial to curbing the virus's spread gave way to another crisis.

Worcester County State's Attorney Kris Heiser said fraud schemes, especially those that target the elderly and other vulnerable groups, are nothing new, but the challenges of pandemic life made way for a rise in victimization.

"Mental health deteriorates when you’re not around other people. ... When you’re home alone, you’re more likely to want to have contact with other people. You’re more likely to engage the scammer on the phone,"

Heiser explained.

In 2021, the Federal Trade Commission fielded close to 2.8 million fraud reports — a steep increase from the pre-pandemic days of 2019, when complaints sat around 1.9 million.

Maryland saw a combined $151.4 million in losses reported to the FTC in 2020 and 2021 as a result of various forms of fraud.

The FBI's 2020 Internet Crime Report noted, "cyber criminals took advantage of an opportunity to profit from our dependence on technology," because of COVID-19.

Reports of internet crime jumped from less than 500,000 in 2019 to 791,790 in 2020, "a record number of complaints," according to the report. This type of crime includes phishing attacks, romance scams, identity theft and spoofing, among others.

The report showed Marylanders lost more than $62 million to these schemes.

Heiser noted trying to catch and prosecute the people who perpetrate this kind of crime is not as effective as preventing it in the first place.

"That’s the case for all crime, but particularly for these, because it’s very hard to prosecute the case, which means it’s hard to make somebody whole if they’ve spent thousands of dollars,"

she said.

Letting the scammer in

Schemes that coerce people into paying someone with gift cards and promises of companionship that deceive people out of sometimes thousands of dollars are among the most common scams to cross Heiser's desk.

There was a "huge increase" in those problems over the past two years.

Answering phone calls or emails that a person normally wouldn't has become one of the unfortunate side effects Heiser has noticed of pandemic isolation. When there's no one else to talk to, people are more willing to engage with a person who seems interested in their life or claims they can offer them something.

"That led to bad results because the one thing that people can control is whether you answer the phone,"

Heiser emphasized.

"You have to let the scammer in in order to get scammed."

In 2021, romance scam reports reached "record highs," rising almost 80% compared to 2020, according to the FTC. The year's $547 million in reported losses was more than six times the reported dollar amount lost for 2017.

Reports of romance scams increased among every age group in 2021. While the rise in complaints was "most striking" for people 18 to 29 years old, people 70 and older reported the highest average loss at $9,000 per case.

The FBI's 2020 data showed the second highest category in terms of dollar amount lost for Maryland was fraud related to romance and other close relationships at $13,128,118.

Requesting gift cards as a form of payment in scams has also steadily increased since 2018, according to the FTC.

In the first nine months of 2021, victims reported spending $148 million on gift card scams — more than all of 2020. The average loss in these cases has gone from $700 to $1,000.

Erasing the stigma of being a victime

One of the difficult elements of fraud amid the pandemic has been the delay in reporting.

Because people weren't leaving their homes or interacting with others as often, cases were more likely to go undetected.

"Then there’s kind of an onslaught," Heiser said. "And you’re like, ‘Wait, where did all this come from?’ "

Heiser explained people may also put off reporting because they're initially embarrassed when they realize they've been scammed.

There were 14,804 victims of internet crime in Maryland in 2020, according to FBI data.

Nationwide, people over the age of 60 were the largest group affected, with more than 100,000 complaints coming from this age group and nearly $1 billion in losses reported.

It's not a matter of the victim being uninformed, Heiser stressed. The "high-tech" nature of the expanding landscape of criminal deception can trap even those who pay close attention.

In the case of romance scams, for example, the FTC characterizes the perpetrators as "masters of disguise," who "study information people share online" and "weave all sorts of believable stories to con people."

"I don’t want anybody to feel sheepish or silly that they were fooled by this," Heiser said. "There are very elaborate situations happening every day."

That's why the Worcester County's Vulnerable Adult Task Force to address the stigma around "having fallen for it."

Even though it's tough to prosecute cases and get victims their money back, Heiser said it's still important for every case to be reported and investigated. Understanding how these schemes work helps direct prevention and awareness strategy.

"If we don’t get the reports because you feel silly that you got scammed, you’re not helping us fix the problem for the next victim,"

Heiser said.

New and evolving scams

Conning people out of large sums of money isn't a new form of crime, but it is growing, changing and becoming more complex all the time.

"There are new and evolving scams out there every day,"

Heiser said.

Though she hasn't seen much of it locally, reports of scams specific to the pandemic have been emerging at the state and federal level.

The 2020 Internet Crime Report from the FBI included 28,500 complaints related to COVID-19.

One of the most prevalent pandemic schemes, according to the FBI, has been government impersonators reaching out to people through social media, emails or phone calls in an attempt to swindle them out of personal information or money.

In one case prosecuted by the Maryland U.S. Attorney's Office, a former FEMA employee posed as someone with the Small Business Administration to convince a business owner to wire him money they received through the COVID-19 Economic Injury Disaster Loan program. 

As attention turned to vaccines, the FBI also saw scams emerge to get people to pay out of pocket for shots, waiting lists and early access.

Since the beginning of 2021, the Maryland U.S. Attorney's Office has charged 23 people with criminal offenses in pandemic-related fraud schemes, according to a news release.

The investigations shut down 17 fake websites — many claiming to sell vaccines and other COVID-19 treatments. These websites often closely matched legitimate ones, such as the sites of vaccine manufacturers, with fake domains that mimicked the designs and language of authentic websites.

Other cases involved the sale of fake vaccination cards and misbranded disinfectants.

Between Jan. 1, 2020, and Jan. 29, 2022, the FTC received 676,176 reports of fraud, identity theft and other types of consumer complaints related to COVID-19 and stimulus payments.

More than 16,000 complaints came out of Maryland — the largest portion being upwards of 6,000 reports of identity theft followed by 5,700 complaints of fraud.

A 2021 FTC news release showed pandemic-related fraud has been thriving on social media platforms, which "are becoming hotbeds for deception," especially as COVID-19 creates "fertile ground for fraud."

The FTC sent more than 400 letters demanding companies "cease making false promises that various pills, potions, and treatments could prevent, treat, or cure COVID-19."

One Maryland-based company received a warning in May 2020 after directing social media users to its website to buy CBD products "intended to mitigate, prevent, treat, diagnose or cure COVID-19" that were "unapproved and misbranded."

Prevention, education and awareness

It can be difficult even to identify the suspect in a scam case, Heiser explained.

Many times the perpetrators are overseas, halting the investigation in its tracks.

Those cases are always forwarded to federal authorities, Heiser said, but it's unlikely the case will go any further.

Suspects who are in the United States are extradited to Maryland whenever possible, but the often lengthy investigations needed in these cases mean victims or witnesses may be difficult to track down when it's time to move forward with charges.

"We do what we can," Heiser said.

That's why prevention, education and raising awareness are key.

Heiser recommends strictly filtering emails, for example, to weed out messages from unknown sources.

"Be as strict as possible because as soon as you see it, that’s the opportunity for you to either not recognize it for what it is or to respond in some way, and the scammer needs you to respond in order to succeed," she said.

Here are more tips from the Maryland U.S. Attorney's Office and the Maryland Department of Labor on how to spot and avoid scams:

  • Fraudulent websites are designed to look like legitimate ones. Watch for small spelling errors or additional letters in URLs and email addresses, or a different domain suffix.
  • Do not click on links in unsolicited emails and be wary of attachments. Do not reveal personal or financial information in an email, over the phone or on an unknown website, and do not respond to solicitations for this information.
  • Always remember: the COVID-19 vaccine is not for sale.  A limited number of manufacturers are authorized to provide vaccines. The federal government covers the cost so people living in the United States will never be asked to pay for a vaccine
  • Use trusted sources such as legitimate government websites for the most up-to-date fact-based information about COVID-19. Social media should not be relied on as a primary source of trusted information.
  • Debt collectors must give the name of the creditor and the amount owed when making contact. They must also obtain verification of the debt if it's disputed. Debt collectors who don't provide this information during the initial contact must send a written notice within five days of that first interaction.
  • Confirm a charity's legitimacy before making donations by contacting the organization directly or verifying the charity's existence through the Maryland Secretary of State or the IRS.