Identity theft fraudBy Michael B. Sauter, 24/7 Wall St.

When times are hard, fraud often gets worse. Americans are under great financial pressure, and there is no shortage of criminals waiting to take advantage of it. According to the most recent report published by the Federal Trade Commission, there were more than 1.8 million complaints of fraud, identity theft or some other deceptive business practices last year. This is up roughly 40% from 2010. 24/7 Wall St. examined the 10 states that had the most complaints in proportion to the size of their populations.

More than 30 different categories of complaints were recorded in 2011. Identity theft was the most common one, representing 15% of all complaints. Many other categories relate to a growing number of Americans in debt as a result of the recession and the housing crash. Debt collection fraud was the second most common category, defined by the FTC as consumers reporting abuse by both legitimate debt collectors and those pretending to be. Other categories included banking and lending scams, as well as scams arising from promises of relief from mortgage debt.

The FTC's Bureau of Consumer Protection has focused in the past five years on "last dollar frauds," such as mortgage foreclosure rescue scams. According to associate director of the Division of Planning and Labor David Torok, "These are the truly pernicious frauds that steal from the consumers that are facing economic problems." These frauds take advantage of consumers in need, "ripping them off under the guise of trying to help them."

Not surprisingly, many of the states that had the highest rates of fraud also experienced the worst of the recession. Five of the 10 worst-off states lost at least 25% of total home value from their prerecession peaks. Seven of the states on this list have among the highest percentage of homeowners who were delinquent on housing payments at the end of 2011.

According to John Simpson at Consumer Watchdog, "It makes sense that states with the highest levels of debt and biggest declines in home value would be the hardest hit by fraud." People is these states "were willing to try solutions that were obviously too good to be true."

While some of the states with the worst rates of fraud have residents that are struggling, many of these states also have relatively wealthy populations who carry a lot of household debt. Six of the 10 states with the highest rates of fraud have among the top 15 highest median incomes. Eight of the states are in the top 15 for mortgage debt per person, and five are in the top 10 for highest credit card debt, according to credit data analytics firm Credit Karma.

In order to identify the 10 states with the highest incidence of fraud, 24/7 Wall st. reviewed data from the FTC's Sentinel Network Data Book, which compiles the total number of complaints for each state. These complaints are divided between identity theft and a second category, which includes all other kinds of fraud. 24/7 Wall St. combined the total complaints of fraud per 100,000 people in each of these categories.

These are the 10 worst states for fraud.


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cactus11

Identity theft a problem in Arizona? Who would figure that? Seems like most of these places are areas where a lot of transient population, coming and going, no roots.

April 16 2012 at 6:38 PM Report abuse rate up rate down Reply
Lesley Donley

When I lived in Florida, I listened to a radio station that was having a contest for a new state motto. They came up with a winner: "Florida, the rules are different here"

April 16 2012 at 4:20 PM Report abuse rate up rate down Reply
brmlmonr

Did it ever occur to the author that the “relatively wealthy populations”, and presumably better educated populations, of the states with the highest number of complaints were more likely to recognize fraud and complain about it than the residents of other states? Like all these rankings, the only thing this ranking shows is the prejudice of the author.
And get an up-to-date picture of Wilmington. The du Pont sign disappeared from the Brandywine Building years ago.

April 16 2012 at 1:26 PM Report abuse rate up rate down Reply
briefit

florida is full of fraud in many areas and it will most likely continue.

April 13 2012 at 7:06 PM Report abuse rate up rate down Reply
briefit

timeshare industry which is primarily incorporated in Florida is the largest ongoing fraudulent industry in history. the state of florida refuses to do anything about it. it will continue because nothing is being done. 99% of all timeshare companies are fraudulent

April 13 2012 at 7:04 PM Report abuse rate up rate down Reply
yankeedoug1121

Fraud in florida! oh come on now the state thats full of illegals and a governor who's company commited over 100 million in medicare and medicade fraud and he got away because he claims he didn't know about it . RIGHT!

April 13 2012 at 1:06 PM Report abuse +1 rate up rate down Reply
jorwmu

illegal aliens trade stolen social security numbers like baseball cards down here in Florida so I wasn't surprised we're #1. An illegal either works for cash and collects welfare or is on the books under a stolen SS# then uses his real name to collect welfare. They've got scamming so perfected that they all drive brand new SUVs and each of their 10 kids has a smartphone and designer clothing! Its disgusting that they're doing better than most Americans because we don't cheat the system

April 13 2012 at 1:00 PM Report abuse +1 rate up rate down Reply
westclr5

Most illegal aliens were brought here by the cartells and now continue to work for them importing drugs and child sex slaves.

April 13 2012 at 12:29 PM Report abuse +2 rate up rate down Reply
westclr5

All the states with high concentrations of blacks and mexicans. GO FIGURE !

April 13 2012 at 12:27 PM Report abuse +2 rate up rate down Reply
jjr526

The illegals using identity theft is a huge issue in the western states for sure.

April 13 2012 at 11:46 AM Report abuse +2 rate up rate down Reply