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Federal Reserve Speeches·

Bowman, A Coordinated Approach to Consumer Fraud Protection

  • Consumer fraud has evolved in scale & sophistication alongside technological advances, posing critical risks to financial security.
  • Fraudulent scenarios often involve impersonation of family members, social media credential theft, phishing links, & fake alerts from retailers.
  • The Federal Reserve prioritizes this issue because fraud threatens the integrity of the financial system & affects nearly every bank account or payment.
  • Fraud losses are a major expense for banks, ranging from $40 million annually for smaller institutions to hundreds of millions for larger ones.
  • The 2025 Survey of Household Economics and Decision making (SHED) indicates 21 percent of American adults experienced fraud in 2024.
  • Non-credit card fraud resulted in $84 billion in total losses in 2024, with only $21 billion recovered, creating a $63 billion net loss for consumers.
  • The median loss for fraud victims was $500 before recovery, negatively impacting the financial condition of 30 percent of those who lost money.
  • Adults aged 45 & older are more likely to experience fraud, while elderly consumers tend to lose larger amounts, though incidence rates are similar across income, race, ethnicity, & gender.
  • More than half of non-credit card fraud involves bank account products, with bank transfers serving as the mechanism for nearly 40 percent of aggregate reported losses.
  • The Federal Reserve is reviewing over 250 comments from a joint Request for Information issued with the FDIC & OCC to inform its comprehensive strategy.
  • Regulatory efforts include enhancing guidance for banks, standardizing fraud terminology to improve data sharing, & integrating scam classifier models into payment platforms.
  • A public-private roundtable involving Secretary Bessent, FCC Chair Brendan Carr, & the Federal Reserve will soon convene to discuss actionable solutions & cross-sector collaboration.
  • Future strategies aim to strengthen bank defenses, improve victim recovery, & ensure regulations address modern & emerging fraud threats.