2009 INTERNET CRIME REPORT INTERNET CRIME COMPLAINT CENTER Bureau of Justice Assistance U S Department of Justice Table of ConTenTs 1 Table of Contents Figures 2009 Internet Crime Report executive summary 2 figure 1 4 overview 3 figure 2 4 General IC3 filing Information 3 figure 3 4 Complaint Characteristics 5 figure 4 5 Perpetrator Characteristics 7 figure 5 6 Complainant Characteristics 8 figure 6 6 Complainant - Perpetrator Dynamics 10 figure 7 8 IC3 Capabilities 11 Maps additional Information about IC3 Referrals 11 Map 1 7 scams of 2009 11 Map 2 8 2009 success stories 12 Map 3 9 Conclusion 13 Map 4 10 appendix I Methodology 15 appendix I ICsIs 16 appendix II Definitions of Top 10 Complaint Types 17 appendix III Complainant Perpetrator statistics by 20 state Tables Table 1 7 Table 2 9 Table 3 10 Table 4 11 Table 5 17 Table 6 20 Table 7 21 Table 8 22 Table 9 23 Bureau of Justice Assistance U S Department of Justice This project was supported by Grant No 2009-BE-BX-K042 awarded by the Bureau of Justice Assistance The Bureau of Justice Assistance is a component of the Office of Justice P the Bureau of Justice Statistics the National Institute of Justice the Office of Juvenile Justice and Delinquency Prevention the SMART Office and the Office for Victims of Crime P this document are those of the author and do not represent the official position or policies of the United States Department of Justice The National White Collar Crime Center N of this document This information may not be used or reproduced in any form without the express written permission of NW3C This publication is also available for download in org or www ic3 gov ©2010 NW3C Inc d b a the National White Collar Crime Center All rights reserved 2 Internet Crime Complaint Center 1 2009 Internet Crime Report Executive Summary From January 1 2009 through December 31 2009 the Internet Crime Complaint Center IC3 Web site 336 655 complaint submissions This was a 22 3% increase as compared to 2008 when 275 284 compla received Of the 336 655 complaints submitted to IC3 146 663 were referred to local state and federa agencies around the country for further consideration The vast majority of referred cases contained ele and involved a financial loss by the complainant The total dollar loss from all referred cases was $559 7 a median dollar loss of $575 This is up from $264 6 million in total reported losses in 2008 Unreferred generally involved complaints in which there was no documented harm or loss e g a complainant rece solicitation email but did not act upon it or complaints where neither the complainant nor perpetrator r the United States i e there was not an appropriate domestic law enforcement agency for direct referra Complaints received by IC3 cover many different fraud and non-fraud categories including auction frau delivery of merchandise credit card fraud computer intrusions spam unsolicited email and child porno All of these complaints are accessible to local state and federal law enforcement to support active inve trend analysis and public outreach and awareness efforts On January 1 2009 IC3 implemented a new complaint classification system based on a redesigned que generates an automatic classification of the complaint into one of 79 offense-based categories This red a number of changes to the way the system gathers and classifies complaint data Further information can be found in Appendix I of this report Significant findings related to an analysis of the complaint dat • Email scams that used the Federal Bureau of Investigation’s FBI name schemes in which the sca to be affiliated with the FBI in an effort to gain information from the target represented 16 6% of a submitted to IC3 Non-delivered merchandise and or payment in which either a seller did not ship item or a buyer did not pay for an item accounted for 11 9% of complaints Advance fee fraud a s the target is asked to give money upfront- often times- for some reward that never materializes m of complaints Identity theft and overpayment fraud scams in which the target is given a fraudulen instrument in excess of the agreed-upon amount for the transaction and asked to send back the o legitimate monetary instrument round out the top five categories of all complaints submitted to IC • Of the top five categories of offenses reported to law enforcement during 2009 non-delivered mer payment ranked 19 9% identity thieft 14 1% credit card fraud 10 4% auction fraud 10 3% and destruction damage vandalism of property 7 9% • Of the complaints involving financial harm that were referred to law enforcement the highest med found among investment fraud $3 200 overpayment fraud $2 500 and advance fee fraud $1 5 • In those complaints in which perpetrator information is provided 76 6% were male and half reside following states California Florida New York the District of Columbia Texas and Washington The of reported perpetrators 65 4% were from the United States A number of perpetrators were also Kingdom Nigeria Canada Malaysia and Ghana • Among complainants 54% were male nearly two-thirds were between the ages of 30 and 50 and third resided in one of the following states California Florida Texas or New York The majority of c were from the United States 92% However IC3 received a number of complaints originating in C United Kingdom Australia India and Puerto Rico • Male complainants lost more money than female complainants ratio of $1 51 lost per male to eve female Individuals 40-49 years of age reported on average higher amounts of loss than other ag • In addition to FBI scams popular scam trends for 2009 included hitman scams astrological reading economic scams job site scams and fake pop-up ads for antivirus software 2009 InTeRneT CRIMe RePoRT Overview 3 local law enforcement agency or local victim’s assist office After a complaint is filed with IC3 the informat The Internet Crime Complaint Center IC3 began is automatically referred to the appropriate local stat operation on May 8 2000 as the Internet Fraud and federal law enforcement agencies Complaint Center Established as a partnership between From January 1 2009 through December 31 2009 the National White Collar Crime Center NW3C and there were 336 655 total complaints filed with IC3 se the Federal Bureau of Investigation FBI IC3 serves as a vehicle to receive develop and refer criminalFigure 1 This is a 22 3% increase compared to 2008 complaints regarding the rapidly expanding arenawhen 275 284 complaints were received The number of cybercrime Since inception IC3 has received of complaints filed per month for 2009 averaged complaints across a wide spectrum of cybercrime 28 055 Dollar loss of complaints referred to law enforcement was at an all time high in 2009 $559 7 matters including online fraud in its many forms million compared to previous years see Figure 2 intellectual property rights IPR matters computer intrusions hacking economic espionage theft The number of complaints referred to law of trade secrets child pornography international enforcement has increased from 72 940 in 2008 money laundering identity theft and a growing list of to 146 663 in 2009 see Figure 3 All complaints additional criminal and civil matters not directly referred are still accessible by law IC3 gives the victims of cybercrime a convenient enforcement used for trend analysis intelligence and easy-to-use reporting mechanism that alerts gathering and consumer education Typically authorities of suspected criminal or civil violations these For non-referred complaints do not involve a documented case of financial or physical harm or law enforcement and regulatory agencies at the local involve a situation in which neither the complainant state and federal level IC3 provides a central referral nor perpetrator reside within the United States In a mechanism for complaints involving Internet-related crimes For affected members of industry IC3 canminority of cases there is no designated agency to refer a complaint based on jurisdictional factors or leverage both intelligence and subject matter expert agency-defined thresholds for referral resources to identify and craft an aggressive proactive approach to combating cybercrime During 2009 IC3 implemented a new complaint IC3 2009 Internet Crime Report is the ninth annualclassification system This complainant-driven system compilation of information on complaints receivedis based on a logic-driven questionnaire that generate an automatic classification of the complaint into one by IC3 and referred to law enforcement or regulatory of an 79 offense-based categories This redesign has agencies for appropriate action The results provide also resulted in a number of changes to the way IC3 examination of key characteristics of 1 complaints 2 system perpetrators 3 complainants 4 interaction between gathers and classifies complaint data The new perpetrators and complainants 5 popular scamsclassification system improves upon the previous system by making clearer distinctions between of 2009 and 6 success stories involving complaints complaint elements and by reducing the number of referred by IC3 The results in this report are intended categories used to classify complaints to enhance general knowledge about the scope and prevalence of cybercrime in the United States This report The results contained in this report were based on does not represent all victims of Internet crime or crime information that was provided to IC3 through the in general because it is derived solely from the people complaint forms submitted at www ic3 gov The dat who filed a report with IC3 represents both a complete analysis of all the compla and a sub-sample of those complaints that have been referred to law enforcement Although IC3’s primary Complaints are submitted to IC3 at www ic3 gov mission is to serve as a vehicle to receive develop a criminal complaints regarding cybercrime those Complainants without Internet access are advisedrefer to use complaints involving other types of crime such as resources at their local library educational institution telephone and mail contact were also referred General IC3 Filing Information 4 Internet Crime Complaint Center Figure 1 Yearly Comparison of Complaints Received via the IC3 Web si 350 000 336 655 300 000 275 284 250 000 207 449 200 000 150 000 124 515 100 000 50 000 0 231 493 207 492206 884 75 064 50 412 16 838 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Figure 2 Yearly Dollar Loss in millions of Referred Complaints $600 $559 7 $500 $400 $300 $239 1 $183 1 $198 4 $200 $125 6 $100 $17 8 $0 $264 6 $68 1 $54 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 Figure 3 Yearly Number of Referrals 146 663 150 000 120 000 103 959 96 731 86 279 90 000 72 940 70 553 60 000 90 008 48 252 30 000 4 810 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2009 InTeRneT CRIMe RePoRT 5 Complaint Characteristics Complaint category statistics may not always produce accurate picture of what is occurring They are based During 2009 email scams that used the FBI’s name the perception of consumers and are thus influenced was the offense most often reported to IC3 comprising how the complainant characterizes their victimization 16 6% of all crime complaints Non-delivery of Two different people may describe the same victimiza merchandise and or payment represented 11 9% of in very different ways complaints Advance fee fraud made up an additional A key area of interest regarding Internet fraud is the 9 8% of complaints Other top 10 complaint categories included identity theft 8 2% overpayment fraud average 7 3% monetary loss incurred by complainants cont IC3 Such information is valuable because it provides miscellaneous fraud 6 3% spam 6 2% credit card foundation for estimating average Internet fraud losse fraud 6 0% auction fraud 5 7% and destruction the general population To present information on ave damage vandalism of computer property i e “computer losses two forms of averages are offered the mean damage ” 4 5% see Figure 4 median The mean represents a form of averaging fam The complaints referred to law enforcement by IC3to the public the total dollar amount divided by the n were largely those cases involving identifiable loss ofThat complaints Because the mean can be sensitive to meant certain complaints received in high numbers e g of extremely high or extremely low loss comp number FBI scams were referred in lower numbers because th the median is also provided The median represents t the complainant’s intent was to notify IC3 of the scam percentile or midpoint of all loss amounts for all com rather than report a financial or physical loss referred to law enforcement The median is less susce to extreme cases whether high or low amounts lost For a more detailed explanation of complaint categories used by IC3 refer to Appendix I at the end of this report Figure 4 2009 Top 10 Most Common IC3 Complaint Categories Percent Complaints Received 16 6% FBI Scams Non-Delivery Merchandise Payment 11 9% 9 8% Advanced Fee Fraud 8 2% Identity Theft 7 3% Overpayment Fraud 6 3% Miscellaneous Frauds 6 2% Spam 6 0% Credit Card Fraud 5 7% Auction Fraud Computer Damage 0 0% 4 5% 5 0% 10 0% 15 0% 20 0% 6 Internet Crime Complaint Center Of the 146 663 referrals during 2009 100 296 involved Over 20 a percent 21 7% of complaints referred to law victim who reported a monetary loss The total dollar enforcement loss involved losses of less than $100 and 3 from all cases of fraud in 2009 that were referred to reported law a loss between $100 and $1 000 Just over enforcement by IC3 was $559 7 million that loss was 28 percent greater 28 3% of the complaints referred to law than 2008 when a total loss of $264 6 million was enforcement reported reported losses between $1 000 and $5 Much of this increase can be attributable to a greater for number a grand total of 86 7% of complaints referred to la of higher loss complaint categories e g identity theft enforcement showing a loss of $5 000 or less and 13 relative to auction fraud which historically has been indicated amonga loss greater than $5 000 see Figure 6 Th lowest loss offenses Of those complaints reporting highest monetary dollar loss per referred incident was reported loss that were referred to law enforcement the mean overpayment dollar fraud median loss of $2 500 complain loss was $5 580 and the median was $575 The significant Investment fraud median loss of $1 857 and advanc difference between the mean and median losses isfraud reflected median by loss of $1 500 complainants were othe a small number of cases in which hundreds of thousands high dollar of loss categories dollars were reported to have been lost by the complainant Figure 5 2009 Top 10 Most Referred IC3 Complaint Categories Percent Complaints Referred Non-delivery 19 9% Identity Theft 14 1% Credit Debit Card Fraud 10 4% Auction Fraud 10 3% Computer Damage 7 9% Miscellaneous Frauds 5 7% Advanced Fee 4 8% Overpayment Fraud 4 5% FBI Scams 4 3% Spam 3 5% 0 0% 5 0% 10 0% 15 0% Figure 6 Percent of Referrals by Monetary Loss 28 3% $0 01 to $99 99 $100 to $999 99 $1 000 to $4 999 99 36 7% 6 5% 5 8% 21 7% 1% $5 000 to $9 999 99 $10 000 to $99 999 99 $100 000 00 and over 20 0% 2009 InTeRneT CRIMe RePoRT 7 Perpetrator Characteristics see Map 1 The District of Columbia Neva As important as it is to understand the prevalenceColumbia and Washington Montana Utah and Florida have the high monetary impact of cybercrime it is also vital to gain see States insight into who the typical perpetrators are This per can capita rate of perpetrators in the United Table 1 Perpetrators also have been identified as res prove to be difficult in the world of cybercrime where a mask of anonymity can impede law enforcementin the United Kingdom Nigeria Canada Malaysia and Ghana see Map 2 Refer to Appendix III at the end of efforts the gender of the perpetrator was reported for more information about perpetrator statistic only 35 1% of the time and the state of residencereport for state Readers are cautioned to note that througho domestic perpetrators was reported only 38 0% ofby the this to document perpetrator demographics represents time In those cases in which a complainant was able information provided to the victim by the perpetrator provide information about the suspect over 76% of the actual perpetrator statistics may vary greatly perpetrators were male and over half resided in California Florida New York Texas Washington and the District of Table 1 Perpetrators per 100 000 People Rank 1 State Per 100 000 People District of Columbia 116 00 2 Nevada 106 73 3 Washington 81 33 4 Montana 68 20 5 Utah 60 22 6 Florida 57 28 7 Georgia 56 99 8 Wyoming 56 40 9 North Dakota 51 01 10 New York 48 10 Based on 2009 Census data Map 1 - Top 10 States by Count Individual Perpetrators Numbered by 6 3 1 10 9 7 4 8 5 1 2 3 4 5 California Florida New York District of Columbia Texas 14 7% 9 7% 8 7% 6 4% 6 4% 6 Washington 7 Illinois 8 Georgia 9 New Jersey 10 Nevada 5 0% 3 3% 3 1% 2 7% 2 6% 2 8 Internet Crime Complaint Center Map 2 - Top 10 Countries by Count Perpetrators Numbered by Rank 4 2 8 1 3 5 9 6 10 7 1 2 3 4 5 United States 65 4% United Kingdom9 9% Nigeria 8 0% Canada 2 6% Malaysia 0 7% 6 Ghana 7 South Africa 8 Spain 9 Cameroon 10 Australia 0 7% 0 7% 0 7% 0 6% 0 5% Complainant Characteristics The following graphs offer a detailed description of2 Although most complainants were from the United all individuals who filed a crime complaint throughStates IC3 has also received a number of filings from the United Kingdom and Australia see Map IC3 The average complainant was male betweenCanada 40 and 49 see Figure 7 and likely a resident of one of 3 compares differences between the dollar the four following states California Florida Texas Table or loss per incident and the various complainant New York see Map 3 Alaska Colorado Nevada and demographics Males reported greater dollar losses th the District of Columbia while possessing a relatively females ratio of $1 51 to every $1 00 Individuals 40 th th th small number of complainants ranked 14 27 25 49 years of age reported on average higher amounts th and 47 respectively had among the highest per capita loss than other age groups rate of complainants in the United States see Table Figure 7 Age of Complainant 22 3% under 20 20 - 29 30 - 39 22 7% 40 - 49 50 - 59 11 9% 60 and over 20 7% 19 4% 3 0% 2009 InTeRneT CRIMe RePoRT 9 Map 3 - Top 10 States by Count Individual Complainants Numbered by 10 4 6 1 8 3 1 2 3 4 5 California Florida Texas New York New Jersey 13 9% 7 5% 7 3% 5 2% 5 0% 6 Illinois 7 Pennsylvania 8 Ohio 9 Virginia 10 Washington 7 5 9 2 3 6% 3 4% 3 0% 2 9% 2 8% Table 2 Complainants per 100 000 People Rank 1 2 3 4 5 6 7 8 9 10 State Alaska New Jersey Colorado Nevada District of Columbia Oregon Maryland Arizona Washington Florida Based on 2009 Census data Per 100 000 People 485 91 166 74 143 21 135 75 131 90 124 18 121 67 121 01 120 56 116 25 10 Internet Crime Complaint Center Map 4 - Top 10 Countries by Count Individual Complainants Numbered 2 3 7 1 8 6 5 10 4 9 1 2 3 4 5 United States 92 02% Canada 1 77% United Kingdom0 96% Australia 0 59% India 0 42% 6 Puerto Rico 7 Germany 8 Mexico 9 South Africa 10 Philippines 0 20% 0 17% 0 16% 0 15% 0 15% Table 3 Amount Lost per Referred Complaint Referred to Law Enforcem Complainant Demographics Complainant Demographics Average Median Dollar Loss Per Referre Complaint Male $650 00 Female $500 00 Under 20 $400 00 20-29 $550 00 30-39 $600 00 40-49 $700 00 50-59 $550 00 60 and older $500 00 Complainant-Perpetrator Dynamics 34 8% of all cases involved both a complainant and One of the components of crime committed via the perpetrator residing in the same state Other states h Internet that makes investigation and prosecution even smaller percentages of complainant-perpetrator difficult is that the offender and victim may be located similarities in residence These patterns not only anywhere in the world This is a unique characteristic indicate “hot spots” of perpetrators that target poten not found with “traditional” crime This jurisdictional victims from around the world but also indicate that issue often requires the cooperation of multiple complainants and perpetrators may not have had a agencies to resolve a given case Table 4 highlights relationship prior to the incident this truly borderless phenomenon Even in California in which most of the reported cases originated only 2009 InTeRneT CRIMe RePoRT 11 Table 4 Perpetrators from Same State as useful productivity tools IC3 offers analyti Along with staff ICSIS trainers and researchers to assist law Complainant State Percent 1 California 34 80% 2 Florida 28 10% 3 New York 24 29% 4 Washington 22 97% 5 Arizona 22 80% 6 Texas 22 26% 7 Nevada 22 20% 8 Georgia 20 95% enforcement with any needs they have regarding cas development These include searching and compiling case information conducting forensic analysis of received data contacting other agencies that may share interest in collaborative investigations providin telephonic training support or direct delivery training building link charts and writing case reports Additional Information About IC3 Refe Although IC3 is dedicated to specifically addressing complaints about Internet crime it also receives 9 Delaware 20 91% complaints about other crimes These include violent 10 Massachusetts 20 60% crimes robberies burglaries threats and many othe violations of law The people submitting these types o complaints are directed to make immediate contact w their local law enforcement agency to secure a timely Following two years of research focus-group events projectresponse to their particular needs If warran effective planning and development IC3 implemented the Internet IC3 personnel may make contact with local law Complaint Search and Investigation System ICSIS a enforcement authorities on behalf of the complainant Web-accessible software solution accessed via a secure password-controlled Web site These features make the tool available to any approved agency with Internet access Hitman Scam and eliminates the need for purchasing any new software or hardware product beyond a typical desktop or laptop In 2009 IC3 received several complaints presenting a computer with a common Web browser new spin on the media coined “Hitman Scam ” a type of email extortion scheme Victims are reportedly bein ICSIS includes a search feature that can explore multiple threatened in an attempt to extort money The victim data streams simultaneously and utilizes “fuzzy logic” receives an email from a member of an organization to improve compilation analysis Third party analytical such as the “Ishmael Ghost Islamic Group ” The emai tools along with import export features i e i2 Analyst claims to have been sent to assassinate the victim an Notebook® link charts are integrated into the application the victim’s family members The emailer asserts tha to supply visual trends and crime patterns within cases reason for the impending assassination resulted from including mapping statistical and timeline functions alleged offense by the victim against a member of th Searches and case folders can be seamlessly shared emailer’s gang In a bizarre twist however the emaile among multiple investigators a user-defined individual reveals that upon obtaining the victim’s information or group such as an investigative task force Usersanother can member of the gang purported to know a include comments or assign attributes and categories member of the victim’s extended family pleaded for Other features include receiving notification whenvictim’s new pardon The emailer alleges that an agreeme complaints are added that match their criteria a discussion was reached with the pleading gang member to allow forum and user-driven support help and feedback the victim pardon from assassination if the victim tak some action such as sending $800 to a receiver in the Working in concert with the ICSIS system is the United Kingdom for the migration of Islamic expatriat Complaint Management System CMS a softwarefrom the United States Victims of this email are typic development project that sets agency threshold instructed to send the money via Western Union® or preferences among any collected data set or combination Money Gram® to a receiver in the United Kingdom thereof and then refers the received complaint to The the emailer often gives the victim 72 hours to send th responsible agency In addition to quickly referringmoney or else pay with his her life cases according to each agency’s priorities CMS allows reallocation of human capital for the purpose of improving IC3 services to recipient agencies IC3 Capabilities Internet Scams of 2009 12 Internet Crime Complaint Center Astrological Reading Scam of employment After sending the copy the victim ne hears from the fraudster again however the employe A familiar scam has resurfaced in which a victim receives account is drained of thousands of dollars by way of spam or pop-up messages offering free astrological fraudulent checks readings The victim must provide his her birth date and Fakethe Pop-up Ads for Anti-Virus Software birth location to receive a free reading After receiving reading the victim is enticed to purchase a full reading Other with the promise that something favorable is about to complaints commonly reported to IC3 in 2009 appeared in the form of pop-up ads for rogue anti-viru happen The victim pays for the full reading but never software Victims reportedly receive ads warning them receives it and most attempts to contact the “Professional the existence of threatening viruses and or illegal con Astrologer ” via email return as undeliverable allegedly found on the victim’s computer When victim click on the fake pop-ups malicious code is download Economic Stimulus Scam onto their computers Victims are directed to purchas Another popular scam of 2009 involved unsolicitedanti-virus calls software to repair their computers but in so regarding fraudulent “government stimulus money ” IC3 instances this resulted in viruses Trojans or key logg received numerous complaints from victims receiving downloaded onto their computers Attempts to contac unsolicited telephone calls with a recorded message the anti-virus software companies were unsuccessful The recorded voice message reportedly sounds very much like President Barrack Obama discussing alleged government funds available for those who apply Victims are warned that the offer is only availableIC3 for routinely receives updates on the disposition of referrals from agencies receiving complaints These a limited time and are instructed to visit the Web sites include documented arrests and restitution as well as www nevergiveitback com or www myfedmoney com related to ongoing investigations pending ca to receive their money These sites require victimsupdates to enter personal identifying information after which and theyarrest warrants IC3 can only gather this data from theofagencies that voluntarily return enforcement resu are directed to a second page to receive notification and it has no authority to require agencies to submit eligibility Upon completion of an online application and status forms payment of $28 in fees victims are guaranteed toreturn receive a large sum of stimulus money but they never do IC3 has assisted law enforcement with many successf case resolutions Some of the cases include the follow Job Site Scams Success Stories • The Alamance County Sheriff ’s Office of North IC3 has received numerous complaints about workCarolina received a referral from IC3 in April at-home scams and survey scams related to online job sites With work-at-home scams victims fall prey to 2009 regarding a series of alleged fraud cases with fraudulent postings for a variety of positions rangingan international nexus At least one of the alleged from personnel managers to secret shoppers Victimssuspects was residing in their jurisdiction Accordin are lured into providing the fraudster with personal to complaints related to this case the alleged vict posted advertisements on Craigslist and were identifying information with promises of above average subsequently contacted by a potential buyer In al hourly wages or several hundred dollars per week Some victims are promised the hardware and or software cases the buyer would pose as a wealthy individu usually a doctor or CEO claiming to be out of the equipment needed to perform the job These sites can be country at the time either in Ireland or Nigeria so convincing that victims are oftentimes scammed into The buyer would then send a check for more than cashing checks or money orders that they receive then redistributing a portion of the funds by way of their the price of the item requesting that the victim wi personal check cash money orders or wire transfersthe to remaining funds back to the buyer Complaints related to this case filed with IC3 culminated in a third party $6 849 99 in reported losses Currently this series In survey scams fraudsters post ads for participationof investigations is continuing Other jurisdictions in a survey regarding employee employer relationships may subsequently become involved The United during the current economic crisis Those who apply are States Secret Service is adopting the case for fede required to send a copy of their payroll check as proofprosecution and the Office of the United States 2009 InTeRneT CRIMe RePoRT 13 • • Attorney will be reviewing aspects of the case •At the Derby Police Department Derby Kansas received time of this release the following suspects have been referral from IC3 regarding suspect Lorraine Robles arrested and charges have been filed Complainants alleged that they had purchased cra items online but did not receive the merchandise Patrick Michael Stone has been charged with 50The case contained six complaints with a total loss counts of forgery of an endorsement 50 counts$352 of Robles was charged with computer crime an forgery of an instrument three counts of feloniously the case was filed in the District Court accessing a computer damage or loss in excess of $1 000 10 counts of common law forgery and • In November 2009 IC3 sent a case to the Tampa 19 counts of third degree sexual exploitation of Police a Department Tampa Florida regarding suspe minor Devon Ashley Crouse was charged with James Diebold A few days prior a victim contacte three counts of felonious aiding and abetting Eddie IC3 about the suspect Other victims with similar Leon Watkins has been charged with one count complaints of were found in the ICSIS database The obtaining property by false pretense He was placed complainants alleged that Diebold sold them ticke under a $1 000 secured bond for everything from sporting events to theme park but did not deliver about $3 500 in goods after the In July 2009 NW3C was contacted by Detective Rick payments were received Diebold was arrested on Arias of the Miami Beach Police Department Miami November 20 2009 by the Tampa Police Departme Beach Florida requesting an investigative searchand on charged with organized crime and third-degre the name Michael Reece This search initially turned grand theft up two complaints Detective Arias responded by providing additional information that may be linked • In April 2009 IC3 created a case with involving 10 to Reece’s activities including email addresses aliases complaints totaling $362 465 18 in losses Victims and alleged victims The case was referred to IC3 this case purchased vehicles through both Craigsli After expanding the search criteria IC3 analysts were and eBay® sending their payment through a bogu able to build a case against Reece that spanned 16 eBay® financing center agent The perpetrator cases with $31 167 50 in reported losses According suggested that the victim use this eBay® financin to the filed complaints Reece using the aliases John center claiming that it served the same function a Essels John Mills and Michael Seren listed ads PayPal® The financial services appeared legitima on Craigslist for vacation rental properties After and even contained the eBay® logo Once the vict the victims signed and mailed the contracts for the wired the money to the bogus “eBay®” agent the properties Reece would then coerce victims to send funds were lost and the victims did not receive the him deposits that ranged from $1 000 to $4 000 The product In July 2009 Sergeant Scott Dugan of the victims would not receive any further contact fromReno Police Department Reno Nevada contacted him Using this information Detective Arias was able IC3 to inform them that an arrest had been made to arrest Michael Reece on July 31 2009 marking the • IC3 sent a case to the Broward County Sheriff’s Offi third arrest of Reece by Detective Arias Fort Lauderdale Florida in May 2009 regarding the In July 2009 IC3 referred a case to the New York State suspected business owner of Godfather Motors Vi Police Department regarding a series of alleged thefts purchased motorcycles but did not receive them a The case involved 13 complaints totaling $17 243 95 payment was made The Sheriff’s Office sent an up in losses The suspect businesses involved were East in November 2009 indicating that the owner Sam Coast Engines Auto Computer Tech and Muscle Paniaqua was arrested in June 2009 for 3rd Degre Sports and Imports all in Altamont New York Grand Theft and is in federal custody in Miami Flo According to the complaints victims alleged that After additional research it was determined that th they had sent items to the owner for repair upgrade perpetrator in fact owned another company in wh but services were not performed and items were not complaints had been lodged returned Additionally a number of complainants paid for parts but did not receive them Investigator Paul Ruckert contacted IC3 in October 2009 with an In Tech 2009 IC3 implemented significant updates and update Subject Jeff Roberts with Auto Computer changes to its method of gathering data regarding was arrested for Grand Larceny Fraud by the Albany complaints in recognition of the constantly changing County Sheriff and the New York State Police Conclusion 14 Internet Crime Complaint Center nature of cybercrime and to more accurately reflect overpayment fraud $2 500 and advanced fee fraud meaningful trends With this in mind changes to the $1 500 Male complainants reported greater losses t IC3 Web site and complaint form were implemented female complainants in January 2009 The new data collection method has afforded IC3 a greater opportunity to examine all Although this report can provide a snapshot of the prevalence and impact of cybercrime it is worth notin complaints through a unique categorization system that knowledge of the “typical” victim or perpetrator that specifically assigns any complaint to one of 79 of the these types of crimes does not imply that atypical complaint types regardless of referral status unlike Internet users are safe or that atypical individuals do previous system commit Internet crimes Anyone who uses the Interne The 2009 IC3 report has outlined many of the current susceptible IC3 has received complaints from both m trends and patterns in cybercrime This data indicates and females ranging in age from 10 to 100 Complain that reports of cybercrime are increasing Annual crime can be found in all 50 states including the District complaints reported to IC3 have increased 667 8%of Columbia and in dozens of countries worldwide when comparing data from the 2001 annual reportThey withhave been affected by everything from work-at2009 Complaint submissions for 2009 were 336 655 home a schemes to identity theft Although the ability t 22 3% increase from 275 284 in 2008 and a 62 7% predict victimization is limited particularly without th increase from 206 884 complaints in 2007 This total knowledge of other related risk factors e g the amo includes many different complaint types includingofboth Internet use or experience many organizations ag fraudulent and non-fraudulent crimes Yet research that education and awareness are major tools to prote indicates that only one in seven incidents of fraudindividuals Some individuals may find themselves ever make their way to the attention of enforcement the victims of computer-related criminal activity even 1 or regulatory agencies The dollar loss from all cases when following the best prevention strategies Variou of crime referred to law enforcement totaled $559 7 consumer alerts tips and fraud trends can be accesse million up from $264 6 million in 2008 via www lookstoogoodtobetrue com a Web site t help provide the educational tips consumers need to Non-delivered merchandise and or payment represents protect themselves the offense that was most referred to law enforcement followed by identity theft accounted credit card fraud References Of those complaints that were referred to law enforcement 1 National White Collar Crime Center The National in which a dollar loss was reported the highest median losses were found among investment fraud $3 200 Public Survey on White Collar Crime August 2006 2009 InTeRneT CRIMe RePoRT - aPPenDIx 15 2 appendix - I Methodology IC3 made a number of changes to the way it gathers and 2009 show the new system to be both reliable and classifies complaint data Beginning January 1 2009 accurate in classifying complaints Since then IC3 ha IC3 implemented a new complaint classification This made only minor changes to the questionnaire to clar system is based on an updated questionnaire designed survey questions for complainants to capture data on various aspects of a complaint and An effort was also made to make IC3 data more generate an automatic classification in terms of the compatible with the National Incident-Based Reportin complaint’s offense content System NIBRS For example “Destruction Damage Prompting the redesign of the classification system were Vandalism of Property” is a NIBRS Group “A” Offense criticisms of the previous system’s ability to protect validity defined as “To willfully or maliciously destroy damage and reliability The previous system had as many as 157 or otherwise injure real or personal property deface complaint categories many of which were either vague without the consent of the owner or the person havin non-mutually exclusive or both The application ofcustody these or control of1 In it ”the new IC3 classification categories produced inconsistencies and classification system this category is used to classify complaints errors making it difficult to discern the prevalenceinvolving of crimes that target and cause damage to certain types of victimization The new classification computers or “true computer crimes ” Definitions of system was designed to minimize such errors the Top 10 complaint types reported in 2009 can be found in Appendix II Although a degree of overlap among complaint categories is unavoidable because of an array of factors—including The introduction of the new classification system crea the multi-faceted nature of complaints subjectivediscontinuities between the 2009 IC3 report and all interpretations of incidents and IC3’s adherence to the previous reports For instance “FBI Scams” is a new Hierarchy Rule—the new classification system improves category that was created to capture instances of uns upon the previous system by making clearer distinctions email containing fraudulent messages from FBI perso and by reducing the number of categories used toIn previous reports such complaints would have been classify complaints The new system uses a fixed set of classified as either “spam” or “threat ” depending on 79 categories representing nearly a 50% reduction in the level of information concerning the email content the number of categories For reporting purposes these contained in the complaint The flood of complaints 79 categories are collapsible into 27 main complaint involving fake FBI email received by IC3 in recent yea types The intent behind this reduction in categories elicited greater attention from law enforcement This was to reduce the likelihood of classification error growing thus concern justified the creation of a separate protecting data validity category to distinguish these complaints from those involving spam or other kinds of threat It should be n The automated classification process also achieves a that as new crime trends surface IC3 may in respons level of reliability that could not be attained by the these developments create new complaint categorie previous system Under the previous system manual capture information deemed useful to law enforcemen sorting of complaints added another layer of subjective agencies in addressing emergent patterns of victimiza interpretation to the classification procedure leading to Such changes in the classification system will be duly inconsistencies in measurement Under the new system in the annual report responses to survey questions yield a sequence of data values translated by the system into one of 79 complaint If you are interested in conducting a longitudinal stud types each corresponding to a unique numeric code of IC3 data that includes data from 2009 special care Systematic field tests conducted in January and February 16 Internet Crime Complaint Center - appendix must be taken to adjust the data so that the 2009 ICSIS reportalso is facilitates collaboration between investigat compatible with previous reports Please contact honing Research in on cases that span multiple jurisdictional Manager John Kane at jkane@nw3c org for assistance boundaries Users may not only search the database complaints to build their own cases they may also se case folders created by other users who are intereste similar if not the same complaints Users converging At the same time the new classification system was the same modus operandi may then communicate wi introduced IC3 also implemented a new data storage each other through the internal messaging service an and retrieval system the Internet Complaint Search and coordinate efforts to further investigate far-flung crim Investigation System ICSIS In addition to storingenterprises IC3 Such networking and sharing of informat complaint data ICSIS incorporates search and analytical across jurisdictions may bring cases into sharper focu tools that allow users to mine complaint data and and develop expedite their disposition With its fuzzy logic sea cases Among the applications available to users is theand information-sharing capabilities ICSIS has tool “fuzzy logic” search tool This tool enables users to collate the potential to revolutionize the way law enforcemen complaints that have identical or nearly identical userofficers fight Internet-facilitated crime specified parameters such as the names and addresses of suspects This application is especially useful in building References cases against repeat offenders who alter fragments of 1 Federal Bureau of Investigation 2000 Uniform Cri their identity information to avoid positive identification Reporting National Incident-Based Reporting Syst by law enforcement Washington D C GPO p 25 ICSIS 2009 InTeRneT CRIMe RePoRT - aPPenDIx 17 2 appendix - II Definitions of Top 10 Complaint Types 1 FBI Scams – Scams in which it appears that the FBI 6 Miscellaneous Fraud – Incidents involving a is trying to get something from the complainant fraudulent attempt to get the complainant to se e g money identity information etc money and where nothing is bought or sold 2 Advance Fee Fraud – An incident involving 7 SPAM– Unsolicited and unwelcome email communications that would have people believe usually mass distributed that to receive something they must first pay money 8 Credit Card Fraud – An incident in which to cover some sort of incidental cost or expense someone is attempting to charge goods and se 3 ID Theft – An incident in which someone stole or to the complainant’s credit card or account tried to steal an identity or identity information 9 Auction Fraud – A fraudulent transaction or but only when there is no other discernible crime exchange that occurs in the context of an onlin involved e g credit card theft auction site 4 Non-Delivery of Merchandise non-auction – An 10 Computer Damage Destruction Damage incident in which the complainant bought something Vandalism of Property – This category is use but it never arrived to classify complaints involving crimes that 5 Overpayment Fraud – An incident in which target and cause damage to computers or “tru the complainant receives an invalid monetary computer crimes ” instrument with instructions to deposit it in a bank account and to send excess funds or a percentage of the deposited money back to the sender Table 5 - Complainant Categories and Subcategories Complaint Types Advanced Fee Fraud Auction Fraud Auction Fraud - Consumer Complaint Auction Fraud - Fake Auction Fraud - Forged or Counterfeit Payment Auction Fraud - Fraudulent Refund Auction Fraud - Insufficient Funds Auction Fraud - No Such Account Auction Fraud - Non-Delivery Auction Fraud - Non-Payment Auction Fraud - Other Auction Fraud - Payment Fraud - Other Auction Fraud - Stolen Auction Fraud - Stolen Payment Unauthorized Auction Purchases 18 Internet Crime Complaint Center - appendix Complaint Types Blackmail Extortion Blackmail Extortion Hitman Emails Charity Fraud Consumer Complaint non-auction Counterfeiting Forgery Spoofing Non-Auction - Forged or Counterfeit Payment Non-Auction - Fraudulent Refund Non-Auction - Delivery of Fake Product Credit Card Faud Destruction Damage Vandalism of includes Property True Computer Crime Adware Computer Abuse other or unknown Computer Virus Spyware Theft of Computer Services this offense almost invariably involves computer hacking Hacking Account Hacking Drug Narcotic Offenses Drug Trafficking Trafficking in Prescription Drugs Employment Fraud FBI Scams Gambling Offenses Online Gambling Crooked Gambling ID Theft Identity Theft - Trafficking in Identifying Information Identity Theft Illegal Business Misc Illegal Business Trafficking in Illegal Goods selling things that are stolen or counterfeit Intimidation non-terrorist-related threats and cyber-stalking Other Threatening Behavior Threat Cyber-Stalking Forum Abuse Investment Fraud Investment Fraud Pyramid Schemes Non-Delivery of Merchandise non-auction Miscellaneous Fraud 2009 InTeRneT CRIMe RePoRT - aPPenDIx 19 Complaint Types Miscellaneous Fraud Non-Auction Consumer Fraud - Other Overpayment Fraud Payment Fraud bad checks insufficient funds or no such account but not counterfeited or forged methods of payment Non-Auction Non-Payment other Fraud Non-Auction - Non-Payment Non-Auction - Stolen Payment Non-Auction - No Such Account Non-Auction - Insufficient Funds Unauthorized Purchases non-credit card Pornography Obscene Material Child Pornography Obscenity Making Available Sexually Explicit Materials to Minors Sexual Solicitation Obscene Communications with Minors Transmitting Obscene Materials to Minors Sexual Abuse Sexual Harassment Sexual Offenses - Other Luring Traveling Prostitution NIBRS Prostitution Offenses Relationship Fraud Rental Fraud Rental Fraud - Not Their House Rental Fraud - Other Rental Fraud - Overpayment SPAM Stolen Property Offenses Music Piracy Software Piracy Non-Auction - Sale of Stolen Goods Online Copyright Infringement Terrorist Threat 5 subcategories Terrorist Threat Terrorist other Terrorist Funding Terrorist Information Terrorist Recruiting 20 Internet Crime Complaint Center - appendix 2 appendix - III Complainant Perpetrator Statistics by State Table 6 - 2009 Complainants by State Rank State Percent Rank State Percent 1 California 13 9% 27 Alaska 1 2% 2 Florida 7 5% 28 Louisiana 1 2% 3 Texas 7 3% 29 Kentucky 1 0% 4 New York 5 2% 30 Oklahoma 0 9% 5 New Jersey 5 0% 31 Connecticut 0 9% 3 6% 32 Kansas 0 9% 3 4% 33 Utah 0 9% 6 7 Illinois Pennsylvania 8 Ohio 3 0% 34 9 Virginia 2 9% 35 2 8% 36 New Mexico 0 6% Mississippi 0 5% 10 Washington 11 Arizona 2 8% 37 12 Georgia 2 7% 38 13 Iowa Idaho 0 7% 0 7% 0 5% 2 6% 39 West Virginia 0 5% 14 Colorado 2 5% 40 New Hampshire 0 5% 15 Maryland 2 4% 41 Hawaii 0 4% 16 Michigan 2 3% 42 Nebraska 0 4% 17 Tennessee 1 9% 43 Maine 0 4% 1 9% 44 Montana 0 3% Massachusetts 1 8% 18 19 North Carolina Arkansas Indiana 45 Rhode Island 0 3% 20 Missouri 1 8% 46 Delaware 0 3% 21 Oregon 1 7% 47 22 Minnesota 1 4% 48 Vermont 0 2% 23 Wisconsin 1 3% 49 Wyoming 0 2% 24 Alabama 1 3% 50 South Dakota 0 1% 25 Nevada 1 3% 51 North Dakota 0 1% 26 District of Columbia 0 3% South Carolina 1 2% Represents Percentage of total individual complainants within the United States where state is known Please note that percentages contained in the table above may not add up to 100% The table above only represents statis from 50 states and the District of Columbia The table above does not represent statistics from other U S territories or Canada 2009 InTeRneT CRIMe RePoRT - aPPenDIx 21 Table 7 - 2009 Perpetrators by State Rank State Percent Rank State Percent 1 California 14 7% 27 Alabama 0 8% 2 Florida 9 7% 28 Wisconsin 0 8% 3 New York 8 7% 29 District of Columbia 6 4% 4 5 6 Texas Washington South Carolina 0 8% 30 Louisiana 0 7% 6 4% 31 Kentucky 0 7% 5 0% 32 Oklahoma 0 7% 7 Illinois 3 3% 33 Montana 0 6% 8 Georgia 3 1% 34 Iowa 0 6% 9 New Jersey 2 7% 35 Kansas 0 6% 10 Nevada 2 6% 36 Delaware 0 5% 11 Arizona 2 5% 37 Nebraska 0 4% 12 Ohio 2 4% 38 Arkansas 0 4% 13 Pennsylvania 2 4% 39 Idaho 0 4% 14 North Carolina 2 0% 40 Maine 0 4% 15 Michigan 1 9% 41 16 Colorado 1 9% 42 17 Virginia 1 8% 43 Mississippi 0 3% 18 Maryland 1 6% 44 North Dakota 0 3% 19 Utah 1 5% 45 West Virginia 0 3% 1 4% 46 Wyoming 0 3% Massachusetts 1 4% 47 New Hampshire 0 3% South Dakota 0 2% 20 21 Tennessee 22 Indiana 1 3% 48 23 Missouri 1 3% 49 24 Minnesota 1 1% 50 25 Connecticut 0 9% 51 26 Oregon 0 9% New Mexico Hawaii Alaska Rhode Island Vermont 0 4% 0 4% 0 2% 0 2% 0 2% Represents percentage of total individual perpetrators within the United States where state is known Please note that percentages contained in the table above may not add up to 100% The table above only represents statis from 50 states and the District of Columbia The table above does not represent statistics from other U S territories or Canada 22 Internet Crime Complaint Center - appendix Table 8 - Complainants per 100 000 People Rank 1 State State Per 1 000 485 91 27 Indiana 82 74 2 New Jersey 166 74 28 Georgia 79 56 3 Colorado 143 21 29 Massachusetts 79 34 4 Nevada 135 75 30 North Carolina 78 95 District of Columbia 131 90 31 5 Alaska Per 1 000 Rank Alabama 78 83 6 Oregon 124 18 32 Illinois 78 60 7 Maryland 121 67 33 Michigan 78 23 8 Arizona 121 01 34 Rhode Island 78 80 120 56 35 Pennsylvania 78 20 9 Washington 10 Florida 116 25 36 West Virginia 76 32 11 California 107 56 37 Connecticut 76 05 Virginia 103 76 38 New York 75 62 New Hampshire 101 24 39 12 13 South Carolina Ohio 75 39 14 Hawaii 97 82 40 75 05 15 Idaho 94 77 41 Minnesota 74 03 16 Delaware 93 43 42 Louisiana 73 46 17 Wyoming 92 78 43 Oklahoma 73 33 18 Vermont 92 64 44 Arkansas 70 63 19 New Mexico 90 06 45 Wisconsin 67 99 20 Utah 89 99 46 Nebraska 65 51 21 Montana 89 12 47 Kentucky 65 39 22 Kansas 89 04 48 23 Tennessee 88 22 49 North Dakota 57 81 24 Missouri 85 47 50 South Dakota 51 82 25 Texas 84 09 51 Mississippi 51 21 26 Maine 83 89 Based on 2009 Census figures Iowa 64 99 2009 InTeRneT CRIMe RePoRT - aPPenDIx 23 Table 9 - Perpetrators per 100 000 People Rank 1 State Per 1 000 Rank District of Columbia 116 60 27 State Per 1 000 Oregon 25 17 Virginia 24 12 2 Nevada 106 73 28 3 Washington 81 33 29 4 Montana 68 20 30 5 Utah 60 22 31 Minnesota 22 93 Delaware 57 28 32 Missouri 22 89 7 Florida 56 99 33 8 Wyoming 56 40 34 9 North Dakota 51 01 35 10 New York 48 10 36 Indiana 21 60 11 California 43 16 37 Kansas 21 49 12 Arizona 40 45 38 Iowa 21 37 13 Colorado 40 36 39 14 Alaska 35 36 40 15 Georgia 34 04 41 33 63 42 Oklahoma 19 74 33 52 43 New Mexico 19 60 Alabama 18 79 6 16 17 18 New Jersey Maine Massachusetts Rhode Island Ohio North Carolina 23 20 23 12 22 88 22 80 22 75 New Hampshire 21 13 Michigan Pennsylvania 20 57 20 36 31 63 44 19 Maryland 29 72 45 20 Hawaii 29 10 46 Kentucky 17 45 21 Idaho 29 04 47 Louisiana 16 98 22 Texas 28 02 48 West Virginia 16 92 27 96 49 Arkansas 15 95 27 84 50 Wisconsin 15 15 51 Mississippi 12 19 23 24 South Dakota Tennessee Connecticut Illinois 25 Nebraska 26 71 26 Vermont 26 69 South Carolina 18 45 Based on 2009 Census figures The 336 655 complaints represent an all-time high in reported submissions to IC3 and account for a total loss of nearly $727 million The median loss per complaint totaled $508 somewhat less than that reported for complaints that were referred to law enforcement The large difference between the total loss figure of all complaints and referred complaints is due in large to complaints in which neither the complainant nor perpetrator resides within the United States This accounts for the vast majority of non-referred complaints However a minority of those cases could not be referred because the agencies to which they would otherwise be referred required a minimum threshold to be met before accepting the complaints