Australian authorities arrest three in alleged romance scam

Australian police have arrested three individuals on charges related to romance fraud. The suspects, two women and a man, allegedly attracted three victims using a newspaper dating ad posing as a widowed 50-year-old woman. According to authorities, the victims paid nearly half a million dollars to the alleged fraudsters from June 2022 to February 2023. Police were alerted to the crime by two elderly victims. 

“To defraud any person is horrible,” said Detective Sergeant Matthew Hogan of the Far North High Risk Investigations Team, “but to specifically seek out mature people who may be vulnerable, it’s cruel and QPS will investigate all matters, until alleged offenders are before the court and support is provided to those victims.”

Victim losses exceeded $500,000 

According to authorities, the victims believed they were paying for a legitimate dating service and providing money to their love interest to help her out of a difficult work situation. But after the supposed widow stopped replying to him, one of the men grew suspicious and prompted police to open an investigation. Another, encouraged by a friend to consider the possibility that he was being scammed, also contacted authorities.

On June 25, search warrants were executed at the suspects’ homes, uncovering $79,200 in cash at one of the properties and concluding in the arrest of two women. One of the suspects, a man, turned himself in at the Broadbeach Police Station after additional evidence helped the detectives locate him.

The two men who reported the scam lost about $42,000 and $343,500 respectively. The third victim lost over $111,000.

According to Detective Hogan, dozens of additional people across Australia may have also fallen victim to the scam. Cairns Criminal Investigation Branch (CIB) detectives have asked the public to provide any additional information they may have on the case. 

Scam risks for vulnerable Australians

Scams cost Australians more than $3 billion in 2022, according to the Australian Competition & Consumer Commission (ACCC). The rate has skyrocketed 80 percent since 2021. According to data from Scamwatch, reported romance scams came in second to investment scams at $40 million in losses. When combined with the report’s other data sources, that number rose to over $210 million. Victims 65 and older reported the most scams and lost above $120 million, more than any other age demographic. Indigenous people also reported more romance scam losses than any other typology except investment scams.

The romance scams in this investigation are an example of elder financial exploitation (EFE). EFE is the most common form of elder abuse and involves misusing (often illegally) older people’s finances, assets, or possessions. The perpetrators of EFE may be close to their victims, friends, and family members, or may be strangers such as online or offshore scammers. Perpetrators may seek to move the proceeds of EFE using financial products and instruments, meaning that financial institutions are on the first lines for fighting this type of illegal activity. EFE may be more prevalent in areas experiencing economic adversity or types of crisis that leave older adults exposed to risk.

Next steps for firms

EFE is a growing problem in jurisdictions around the world. To protect their most vulnerable customers, firms should ensure they’re familiar with the latest warning signs. An accurate understanding of this growing risk can ensure fraud and anti-money laundering frameworks effectively protect  the most vulnerable. Firms can consult guidance from the Australian government on recognizing when a senior is being exploited. Several additional steps can help firms ensure they are responding effectively to this risk:

• Consider elder fraud risks during regular enterprise-wide risk assessments. 
• Provide fraud recognition and intervention training to staff. 
• Include procedures for senior fraud risks in fraud prevention and detection. 
• Educate customers on fraud risks – and provide them with accessible resources and support should they be exploited.