Call to Action: Take a Stand Against Digital Swindlers Online
In a bid to tackle the growing issue of digital payment scams, a bipartisan group of senators has proposed the Taskforce for Recognizing and Averting Payment Scams Act (TRAPS Act). The proposed legislation aims to create a federal task force led by the Treasury Department, with members from various agencies such as the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC).
The scourge of digital payment scams has been on the rise, with an estimated $12.5 billion being stolen annually from Americans, according to recent estimates. This figure represents a 25% increase from the previous year. Scammers employ various tactics, including pretending to be from government agencies like the Department of Motor Vehicles (DMV) or threatening individuals with unpaid toll fines.
In July 2023, New York state issued a warning about scammers posing as the DMV. This followed a series of "toll road scams" earlier in the year. These scams are not limited to seniors; they affect a wide range of individuals. In fact, seniors have been particularly vulnerable, with many losing tens or even hundreds of thousands of dollars, often their entire life savings, to these scams.
The TRAPS Act, if passed, will empower the task force to investigate scammers, recommend new legislation and regulations, and enhance coordination of federal, state, and local law enforcement. The task force will also address the role of telecommunications and technology providers in preventing digital payment scams.
The sponsors of the TRAPS Act in the U.S. Senate are Republican Senator Mike Crapo of Idaho (primary sponsor), Democratic Senator Mark Warner of Virginia (co-sponsor), Republican Senator Jerry Moran of Kansas (co-sponsor), and Democratic Senator Raphael Warnock of Georgia (co-sponsor). A House version of the TRAPS Act was introduced by Representatives Zach Nunn, R-Iowa, and Jim Himes, D-Connecticut, with support from credit union groups emphasizing the importance of protecting consumers from financial fraud.
The proposal is supported by groups representing victims (like the AARP) and groups representing business (like the American Bankers Association). The infamous thief Willie Sutton once said, "Because that's where the money is," in reference to banks. Today, the money is primarily on phones and computers, making them targets for modern thieves.
The TRAPS Act seeks to protect consumers by analysing trends in payment scams, identifying prevention methods, reviewing scam techniques related to payment platforms (like bank accounts and gift cards), and developing educational programs to protect consumers from scams. The task force will work towards restoring trust in the nation's marketplaces and prioritising the safety of Americans, particularly seniors.
The TRAPS Act, in an attempt to mitigate rising digital payment scams and safeguard personal-finance, is aimed at creating a task force that will collaborate with general-news agencies such as the Treasury Department, Consumer Financial Protection Bureau (CFPB), and the Federal Trade Commission (FTC). If passed, this task force will investigate scammers, propose new regulations, and work with telecommunications and technology providers to reduce these scams, a concern that has led to an estimated $12.5 billion loss annually and affected various demographics, including seniors who have often lost substantial amounts of money, sometimes their entire life savings, to these scams.
