CRIME CONCERNS Cyber scams cost Ohioans $10.6M

The state’s top law-enforcement officer will soon have more authority to battle Internet-related crimes — acts that cost Ohioans a reported $10.6 million last year.

Starting June 7, Ohio’s cyber fraud law will give the state the same criminal-subpoena power prosecutors have in suspected cases of online fraud.

“Criminally prosecuting these people is important because for many of them a civil penalty or fine is just the cost of doing business,” said Ohio Attorney General Mike DeWine in an exclusive interview with the Dayton Daily News.

Criminal prosecutions for online scams will have a “deterrent effect,” he said.

Currently, state authorities can subpoena information only to build civil cases. They can seek fines and restitution but no criminal punishment, such as prison time.

The new cyber fraud law will give the attorney general the authority to subpoena the phone records, Internet Protocol (IP) addresses and payment information in suspected cyber fraud cases and prepare them for criminal prosecution by a county or special prosecutor.

“We will be able to run these cases down, get the information and determine whether or not there is a criminal violation, then turn it over to the prosecutor,” DeWine said. “It is going to increase the number of criminal cases that we can assist local prosecutors in prosecuting.”

Ohio had a total of 12,661 complaints last year related to crimes committed using the Internet, ranking the state fifth among all states, according to the Internet Crime Complaint Center’s 2011 Internet Crime Report. Victims in Ohio reported total losses of $10.6 million, ranking the state ninth in the nation.

The state’s large population is a factor, said Todd Lindgren, a spokesman for the Federal Bureau of Investigation’s Cincinnati division. When adjusted per 100,000 population, Ohio ranked sixth in the number of complaints and 45th in average dollar loss.

“I don’t necessarily believe that Ohio is any more vulnerable than other states to these Internet scams,” Lindgren said. Instead, the data indicate Ohio residents are alert to the cyber fraud problem and willing to report suspected cases to the complaint center and law enforcement, he said.

The complaint center was established as a partnership between the FBI and the National White Collar Crime Center to receive Internet-related criminal complaints for analysis and referral to federal, state, local or international law enforcement.

Nationally, the center received more than 300,000 complaints in 2011, a 3.4 percent increase from the previous year. The adjusted dollar loss of complaints was $485.3 million.

The most common complaints included FBI-related impersonation scams, identity theft and advance fee fraud.

Internet-related crime is a “huge problem” for Ohio, according to DeWine. In February, an Ohio couple were sentenced to prison for running a Craigslist ticket scam that took more than $200,000 from hundreds of victims throughout the U.S. and Canada.

The Internet poses unique challenges for law enforcement, such as jurisdiction issues, DeWine said.

Many online scams originate from African nations such as Nigeria, whose lack of treaties with the U.S. and other western countries make them “havens for criminal activity online,” said C. Matthew Curtin, founder of Interhack, a Columbus-based forensic computing firm.

Criminals often target less sophisticated people through spam attacks in which they pose as a government or financial agency to gain access to victims’ account information.

“The issue is that it’s a numbers game, so even if you’ve got 50 percent of the population that is able to recognize fraud, if you send out 10 million spam messages trying to trick people, you are going to have an awful lot of people who fall for it,” Curtin said.

Technologies such as smartphones are providing criminals with new avenues to try to reach into your pocket, said John North, president and chief executive of the Dayton Better Business Bureau. The agency has seen an increase in text messaging scams that claim the victim has won a $1,000 gift card, which they can claim by clicking on a link the scammer has provided.

“What they are trying to do is access personal information … that may be stored on your smartphone that may not be protected,” North said.

The Better Business Bureau itself was the target of an online scam in February, when businesses nationwide received fake emails using the agency’s name that asked them to click on a link to update their information. The link led to a third-party website that downloaded a virus to victims’ computers. “Many businesses here in the area were impacted by it,” North said.