WASHINGTON, D.C. — A new report from the Consumer Federation of America (CFA) finds that Michigan residents lose an estimated $1.7 billion annually to online scams — about $170 per person — while Americans lose an estimated $119 billion nationwide each year.
This “true” cost of scams is over seven times higher than what was reported to the FBI in 2024, and comes as Americans reported losing $16.6 billion to online scams, a 33 percent increase from the previous year. The total $119 billion figure adjusts the FBI’s Internet Crime Complaint Center (IC3) data from 2024 to estimate a more comprehensive cost to individuals each year.
Michigan, with reported losses of $241.7 million, faced true losses estimated at $1.73 billion. Michigan’s manufacturing base and its high population of auto industry retirees create unique vulnerabilities to employment scams and pension related online fraud, the report found. The state’s roughly $170 per capita loss impacts Detroit’s urban communities and rural Upper Peninsula residents alike.
The report also identifies Meta’s platforms — Facebook at 57%, Instagram at 22%, and WhatsApp at 8% — as the top three online platforms associated with scams, according to the Better Business Bureau. The Global Anti-Scam Alliance has also found that 81 percent of all scam attempts in the US occurred on platforms with a direct message function.
Watch the press briefing of the report here.
The report highlights that social media platforms, specifically Meta-owned Facebook and Instagram, are the platforms most commonly associated with online scams, drawing on investigative reporting to illustrate how these companies profit heavily from the presence of scam content on their platforms:
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Reuters reported that internal Meta documents projected roughly 10 percent of its 2024 revenue — about $16 billion — would come from ads promoting scams and banned goods. The investigation also reported that Meta directed its own staff not to take action that would threaten more than 0.15 percent of the company’s revenue.
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According to The New York Times, Meta allowed scammers to run over 150,000 political advertising scams involving deepfakes and misleading paid content, which earned the company over $49 million over a seven year period.
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The Wall Street Journal reported that Meta, which the article called, “a cornerstone of the internet fraud economy,” allows suspicious advertisers to accrue up to 32 automated ‘strikes’ for financial fraud before it bans their accounts.
“The devastating scale of losses represents a crisis that demands swift and unflinching attention, as people increasingly feel unsafe online,” said CFA Director of AI and Privacy Ben Winters. “These statistics show that action across the economy – increasing platform liability, shutting down data brokers, improving reporting mechanisms, regulating generative AI, and beefing up consumer protection enforcement resources – are not only exciting ideas but mandates for a safe future.”
The Consumer Federation of America’s analysis of the true cost of scams relies on underreporting patterns documented by the Bureau of Justice Statistics and other researchers, which found just 14 percent of financial fraud victims reported the incident to authorities. The total $119 billion figure adjusts the FBI’s Internet Crime Complaint Center (IC3) data from 2024 to estimate a more comprehensive cost to individuals each year.
At the same time, the $119 billion estimate accounts only for direct losses to individuals. Business losses and secondary losses associated with scams — legal fees, lost productivity, and other indirect costs, as well as impacts on international victims — are not fully captured in this figure, meaning the total U.S. economic impact is likely even higher.
Other major findings from the report include:
Social Media Platforms Failing To Stop Online Scams
The report cites data from the Global Anti-Scam Alliance (GASA) 2025 report and the Better Business Bureau, which show that most scams reported by Americans originated on social media, and that the majority of users surveyed (57%) observed no discernible action taken by platforms in response to complaints.
The report recommends that platforms do more to create safer design features that limit fraud, including by providing stronger default privacy settings, enhancing identity protection tools to detect and prevent fraudulent profiles, and establish stronger fraud reporting systems for users.
Criminals are targeting Americans with a wide variety of different scams:
The most frequent types of scam that Americans lost money to are investment scams (estimated $46.6B), followed by email targeting scams ($19.7B), tech support scams ($10.4B), nonpayment and delivery scams ($5.6B), romance scams ($4.7B) and government impersonation scams ($2.9B).
Michigan experienced an estimated true loss in scams of over $1.7 billion every year, as the state’s disproportionately large manufacturing and auto industries present pension and employment scam vulnerabilities. South Carolina and Nebraska’s economies were uniquely hurt by scammers targeting their tourism and agricultural industries, respectively. Estimated losses in other states like Pennsylvania ($2.9B) and Wisconsin (estimated $1.2B) were also considerable.
The report comes as online scams continue to cost more Americans money every year. In 2024 alone, Americans reported losing $16.6 billion to online scams, a 33 percent increase from the previous year, underscoring the rapidly growing threat of digital fraud. Americans are increasingly seeing scams as a major threat, too: according to a recent Data for Progress poll of New Yorkers, one third of those surveyed said they were personally impacted by an online scam or fraud while nearly 90 percent said online scams and fraud are a very big or moderately big problem.
“Behind these staggering numbers are real people whose savings and retirement security are being stolen. Older Americans are the most frequently targeted by scams, losing peace of mind and money they cannot replace,” said Richard Fiesta, Executive Director of the Alliance for Retired Americans. “This report shows that the true cost of fraud in America is far greater than what official statistics show. Without strong action, this cost will keep rising with new technologies. Policymakers, regulators, and corporations whose platforms spread scam ads and messages must act with urgency to protect older adults and hold bad actors accountable.”
“It’s clear that online scams are a huge problem on social media,” said Anya Schiffrin, Co-Director of the Technology Policy, Innovation Concentration at Columbia University’s School of International Public Affairs. “Scam ads on Meta, in particular, play a huge role in luring and defrauding victims. Because shame or embarrassment often deters victims from reporting scams, we have never had a full picture of what scam losses may look like. “The Scam Economy” report fills this critical gap and makes an important contribution to quantifying the true cost of online scams and crime.”
About Consumer Federation of America
The Consumer Federation of America (CFA) is an association of non-profit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education.
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BY-Nicolas Rubando
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