Financial Fraud Epidemic Sweeps Japan, Losses Soar to Record High

A Growing Concern

A stark reality has emerged from the latest police statistics in Japan: financial fraud losses have skyrocketed by 31.5% to a staggering ¥37.1 billion, with reported cases rising by 21.2%. For the first time in eight years, the nationwide losses from specialized fraud have seen a year-on-year increase.

Record High Numbers

According to the National Police Agency’s finalized statistics for 2022:

• The number of reported cases of fraud reached an alarming 17,570, up 3,072 from the previous year.
• The police handled a total of 6,640 cases, involving 2,458 fraudsters - an 84% increase from the previous year.

Disturbing Trend

A disturbing trend has emerged, with 473 individuals under the age of 20 recruited as accomplices to commit fraud. Many of these young perpetrators were lured into “dark part-time jobs” online, highlighting the ease with which fraudsters can recruit unwitting accomplices.

Geographic Concentration

The fraud cases are concentrated in major metropolitan areas, with:

• Tokyo, Kanagawa Prefecture, Osaka Prefecture, Chiba Prefecture, Saitama Prefecture, Hyōgo Prefecture, and Aichi Prefecture accounting for roughly 70% of all cases in Japan.

Daily Losses

On a daily basis, the losses from specialized fraud reached ¥101.6 million, a year-on-year increase of ¥24.3 million. The average loss per case also rose to ¥2.2 million, up ¥166,000 from the previous year.

Types of Fraud

The main types of fraud saw:

• Refund fraud emerge as the most common, with 4,679 cases reported.
• Ore ore sagi scams, where fraudsters impersonated family members, accounted for 4,287 cases.
• Cash card scams, in which elderly individuals had their cash cards replaced with fake ones, resulted in 3,074 cases.

Most Lucrative Scams

The “ore ore sagi” scams proved to be the most lucrative, with losses totalling ¥12.9 billion or 35% of all fraud-related losses.

Combating the Epidemic

As Japan’s authorities scramble to combat this growing epidemic, it is clear that a concerted effort must be made to educate the public and crack down on these cunning scammers.