The Disappearance of the Fraud Victim Report

Robert D. Kuykendall, Utica College of Syracuse University
Kyung-Seok Choo, Utica College of Syracuse University

The study uses a foundation of a fraud survey and focus groups coordinated by one of us, Kuykendall in 1999. These studies, two of the very few on this topic, uncovered two general causes of low consumer fraud reporting: (1) Consumers do not know where to go for help, and (2) consumers believe law enforcement agents do not care about their financial victimization. Only one of these problems exists in identity theft and credit card fraud, because consumers generally do know where to go in these instances - their financial institutions. While it seems that the removal of one problem is a positive step, research will demonstrate that the problem remaining contains two sub-issues that create an even more damaging cycle that may lead to the disappearance of the fraud victim's report. The research seeks statistical support for problems believed to be creating the negative reporting trend and relationship between low victim reporting and limited law enforcement action. This relationship contains a "chicken and egg" riddle: Which came first, the non-reporting to law enforcement which leads to lack of enforcement action; or lack of action which leads to consumers' cynical attitudes and lack of reporting. While it is unclear which is the genesis of the other, the proven correlation will verify a trend that could lead to the disappearance of the fraud complaint and an attack of the entire criminal justice system.

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Updated 05/20/2006