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Mixed-methods Analysis of Consumer Fraud Reports of the Social Security Administration Impostor Scam

Authors

Abstract

Most Americans have received fraudulent calls from impostors claiming to be officials from the Social Security Administration (SSA). Callers threaten those who respond with arrest and suspension of their bank accounts and Social Security numbers, but charges can be removed if the target agrees to buy retail gift cards, wire money, or deposit cash in cryptocurrency ATMs. This paper uses mixed methods to analyze SSA imposter scam consumer reports from victims and attempted victims filed in the Consumer Sentinel. Qualitative analysis of 600 case narratives reveals that SSA impostors use the persuasion principals of authority, reciprocity, liking, and scarcity to put pressure on consumers to comply with their requests. Expressions of fear, anger, anticipation, and trust in the imposter were present in the victim case narratives. Qualitative findings were supported using a quantitative sentiment analysis of more than 200,000 consumer reports to count the frequency of emotion words in case narratives. Emotional expressions were significantly associated with reported victimization versus attempted victimization. Quantitative models show that older adult consumers are significantly less likely to report victimization relative to those 30 and younger, but older victims lose significantly more money per incident on average. Results also indicate that consumers from majority Black, Asian, and Hispanic communities are more likely report victimization, although victims from non-Hispanic White communities report higher average loses. Consumer education on government imposter scams, specifically targeting young people and minorities, as well as greater controls on retail gift card sales, might help limit consumer losses.

Key Findings

  • SSA impostors use four key principals of persuasion to manipulate consumers to pay money: reciprocity, authority, liking, and scarcity.
  • Older adults (age 65+) are significantly less likely to report victimization relative to younger consumers, but they lose significantly more money per incident on average.
  • The odds of reporting victimization are higher for consumers residing in more Black, Hispanic, and Asian neighborhoods relative to more non-Hispanic White neighborhoods.
  • Financial losses are significantly higher for victims who paid impostors using wire transfers and cash compared to those who paid with retail gift cards.
  • In written complaint narratives, consumers’ use of words expressing “trust,” “anticipation,” “fear,” “anger,” and “sadness” are significantly associated with victimization and with the amount of money lost.

Citation

DeLiema, Marguerite, and Paul Witt. 2021. “Mixed Methods Analysis of Consumer Fraud Reports of the Social Security Administration Impostor Scam.” Ann Arbor, MI. University of Michigan Retirement and Disability Research Center (MRDRC) Working Paper; MRDRC WP 2021-434. https://mrdrc.isr.umich.edu/publications/papers/pdf/wp434.pdf

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Project

Paper ID

WP 2021-434

Publication Type

Working Paper

Publication Year

2021