A recent monograph by the Federal Reserve Bank of Richmond outlines the evolution of scams from old school to high-tech.
A century ago, growing use of checks spawned the crime of kiting, covering one bad check with another. Then crooks began stealing checks from the mailbox and “washing” the ink with solvent. In some cases, thieves lowered glue-covered bottles on strings into Postal Service mailboxes to snag envelopes.
Scammers have graduated from fishing to phishing, utilizing artificial intelligence tools including large language models like Chat GPT to ensnare more victims than ever. Cybersecurity software firm Imperva estimates that scamming apps account for 37% of all internet traffic. While law enforcement and financial institutions are on the case, traps are increasingly realistic and demand a heightened level of diligence on the part of consumers.
The scourge of AI-enhanced cybercrime has taken a giant leap forward with the despicable emergence of Southeast Asian cybercrime factories employing victims of human trafficking to mass produce attacks at a previously unimaginable scale. These enterprises, known locally as scam compounds, are operated by organized crime with near impunity and employ a mix of high-tech tools old-fashioned slave labor to victimize people around the world, including billions in fraud against Americans each year.
A lucrative gambling industry flourished in Asia throughout the 2010s. However, a crackdown in 2019 by the Cambodian government followed by China’s 2020 COVID travel restrictions severely constricted the region’s wagering revenue and left dozens of casinos, hotels and resorts largely empty.