The Federal Trade Commission’s new Impersonation Rule equips consumers with stronger protections against increasingly sophisticated scams that stole a record $12.5 billion from Americans in 2024.
At a Glance
- The FTC’s Impersonation Rule, implemented in April 2024, provides stronger enforcement tools against government and business impersonation scams
- Impersonation scams resulted in nearly $3 billion in consumer losses in 2024 alone
- Violators face potential civil penalties up to $53,088 per violation and must provide consumer refunds
- The FTC has already initiated five cases under the new rule and shut down 13 websites impersonating the Commission
- Investment scams accounted for nearly half of all scam losses in 2024, totaling $5.7 billion
A Growing Threat to Consumer Finances
Scammers stole a record-breaking $12.5 billion from Americans in 2024, marking a 25% increase from 2023. Investment scams proved particularly devastating, accounting for nearly half of all losses at $5.7 billion, with victims suffering a median loss exceeding $9,000. The methods of monetary extraction have evolved, with bank transfers ($2 billion) and cryptocurrency payments ($1.4 billion) becoming preferred channels for fraudsters. Within this landscape of fraud, impersonation scams have emerged as a significant threat, resulting in $2.95 billion in consumer losses in 2024 alone.
Scammers frequently pose as government officials, utility companies, banks, or tech support representatives to extract money or personal information from unsuspecting victims. The FTC received nearly 850,000 reports of imposter scams in 2024, highlighting the widespread nature of this deceptive practice. The five most common scam tactics include copycat account security alerts, phony subscription renewals, fake giveaways or discounts, bogus legal problems, and fabricated package delivery issues. Increasingly, these scams are delivered via text messages and emails, while traditional phone call scams are declining.
— Sumsub (@Sumsubcom) March 21, 2024
The FTC’s Enhanced Enforcement Powers
The FTC’s Government and Business Impersonation Rule, which went into effect in April 2024, represents a significant advancement in consumer protection. The rule provides the Commission with stronger tools to combat impersonation scams, including the ability to seek financial restitution for victims and impose substantial civil penalties on perpetrators. Violators may face penalties up to $53,088 per violation, creating a meaningful deterrent against this form of fraud. The rule specifically targets scammers who deceitfully impersonate government entities and established companies.
“The billions of dollars American consumers lose at the hands of impersonators is staggering”, says Chris Mufarrige, Director of the Bureau of Consumer Protection.
Since the rule’s implementation, the FTC has initiated five cases for alleged violations and collaborated with domain registrars to shut down 13 websites impersonating the Commission. One notable case involved Superior Servicing LLC, which was accused of falsely affiliating with the U.S. Department of Education and misleading student loan borrowers. The Commission has also issued warnings to operators of websites selling IRS EIN filing services that mimic the IRS’s free tool, potentially violating both the FTC Act and the new Impersonation Rule.
Protecting Yourself from Impersonation Scams
The FTC emphasizes that it will never demand money, make threats, or promise prizes to consumers. Understanding the tactics used by scammers is essential for self-protection. Consumers should be wary of unexpected contacts requesting money or personal information, regardless of how legitimate they may appear. Caller ID can be easily spoofed, and links in unexpected communications should never be clicked. The Commission encourages consumers to report suspicious activities at ReportFraud.ftc.gov to help identify and shut down scam operations.
As the Impersonation Rule marks its one-year anniversary in April 2025, the FTC continues to refine its approach to combating fraud. Public comments remain open until April 30, 2024, on a proposed rule to prohibit impersonation of individuals and providing tools for scams.
This collective effort between regulatory authorities and vigilant consumers is essential in mitigating the impact and financial damages of impersonation scams. Through education, enforcement, and reporting, the FTC aims to create a safer consumer environment where impersonation scams become increasingly difficult to execute successfully.
