Estonians lose €21 million to scammers in nine months
April was the worst month for fraud in Estonia this year, with scammers stealing more than €4 million, including €1.7 million lost by a single company in an invoice fraud scheme known as business email compromise (BEC).
Police and Border Guard Board (PPA) Director General Egert Belitšev said a BEC scheme is a type of fraud targeting businesses, in which criminals use a fake or spoofed account to convince a company that one of its regular partners has changed its bank account details. The company is then instructed to transfer payments to the new account.
Overall, however, fraud statistics show slight improvement. While victims lost nearly €25 million during the first nine months of last year, losses this year were €4 million lower. Part of the decline is linked to fraud operations in Ukraine involving senior public officials that have since been uncovered.
No phone scams reported in August
More than 90 call centers were shut down in Ukraine over the summer, and the operation has had a clear impact in Estonia as well. No phone scams were reported in August.
"The troubling part is that the investigation identified various Ukrainian officials who were involved in the fraud schemes and provided protection for the scammers," Belitšev said.
Only €1 million of the more than €20 million lost this year is expected to be recovered and returned to victims. At the same time, authorities have made progress in identifying offenders. This year, 38 people have been caught, most of them money mules.
Most offenders are young people
Prosecutor General Astrid Asi noted that most offenders are young people.
"They were mainly recruited through social media accounts, and a large share came from outside Estonia," she said.
Some of those involved have been minors, though most have been in their 20s.
Authorities expect investment scams to become more common in the near future. Sandra Horma, head of fraud prevention at the Estonian Banking Association, said scammers typically promise extraordinary returns and often present the opportunity as a secret offer available only to a specific individual.
"They try to create the impression that the person is such a talented investor that they have been noticed, for example on social media, and are therefore receiving special offers," Horma explained.
Investment fraud caused €5 million in losses during the first nine months of this year.
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Editor: Merilin Leetna, Argo Ideon
