FTC Reports Surge in Consumers’ Losses to Impersonation Scams

Have you ever gotten a text about an unpaid toll?

Or one purporting to be from the U.S. Postal Service about an undelivered parcel? 

If you looked at these messages and thought “Scam,” you were on the right track. And as TechCrunch reported Sunday (Aug. 10), such messages are from a prolific, highly-effective scam operation that netted at least 884,000 stolen credit card details last year.

The scam worked like this: After getting a message that seems genuine, victims click a link that leads to a phishing page where they enter their credit card information, which is then stolen and used for fraud.

But according to TechCrunch, a series of opsec errors helped lead researchers and investigative reporters to the real-life identity of the maker of the scamming software, Magic Cat, otherwise known by the pseudonym Darcula, believed to be a 24-year-old Chinese national.

After being exposed, Darcula apparently vanished, with a new operation taking his place that has already overshadowed its predecessor, the report said.

Dubbed Magic Mouse, this scheme is already behind the theft of at least 650,000 credit cards a month, security researcher Harrison Sand of Mnemonic told TechCrunch. In this scam, the criminals used card details in mobile wallets on phones to commit payment fraud, laundering their funds into other accounts. 

But although these schemes have the potential to swipe millions from consumers, Sands added that law enforcement is not looking for the wider operation underpinning the scheme, with banks and tech companies carrying the burden for allowing these scams to flourish, and for not making it harder for scammers to use stolen cards. 

The news comes amid an uptick in scams targeting consumers. For example, the Federal Trade Commission (FTC) said last week that a growing number of older Americans are losing large sums of money to impersonation scams.

The number of people 60 and older who said they lost at least $10,000 to these schemes quadrupled between 2020 and 2024, while losses exceeding $100,000 jumped eightfold.

As their name suggests, these scams involve someone impersonating a government agency or business and alerting consumers to a fake problem involving their accounts or their identity, and trying to convince them to transfer money to “keep it safe,” the FTC said.

Meanwhile, PYMNTS Intelligence research shows that 30% of Americans, or around 77 million people, have lost money in a scam in the past five years. Most victims lost more than $500, while many suffered thousands in financial damage. 

“This trend marks a significant increase, with scams representing 27% of total dollars lost by financial institutions to fraud in the U.S. in 2024, up from 12% in 2023,” PYMNTS wrote.

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