Securities Regulation Daily Wrap Up, INVESTOR EDUCATION—FINRA Foundation finds consumers think mostly about identity-based frauds, (Jul 28, 2026)
By Anne Sherry, J.D.
When asked to give examples of fraudulent schemes, half of adults mentioned identity-based fraud.
A new report describes what the FINRA Foundation considers to be a gap in consumers’ fraud awareness. The study, a collaboration with RAND, asked respondents to list common fraudulent schemes. Half of adults mentioned identity-based fraud, but consumer-based, imposter-based, opportunity-based, and threat-based schemes were each referenced by only 14 to 20 percent of respondents.
“Understanding which types of fraud are top-of-mind for consumers and which are lesser-known is important for developing effective fraud prevention,” said FINRA Foundation President Christine Kieffer.
Study design. The groups asked 1500 adults from RAND’s American Life Panel to list up to five schemes or tactics fraudsters use. Participants were given definitions for “fraud” and “fraudsters,” then provided text fields in which to list out schemes in their own words. With the help of natural language processing, researchers sorted the answers into five fraud categories:
Consumer-based fraud, when someone sells something fake, unnecessary, or not as advertised.
Identity-based fraud, when the fraudster steals or misuses personal information.
Imposter-based fraud, involving a perpetrator pretending to be a trusted person, company, or government agency.
Opportunity-based fraud, where wrongdoers lure victims with promises of prizes, wealth, or social connections.
Threat-based, creating fear and panic to pressure quick action.
Participants also provided demographic information, completed a three-item financial literacy quiz testing their understanding of interest rates, inflation and risk diversification, and reported on their experience with financial fraud.
Results. On average, survey participants listed out 3.4 fraudulent schemes, but most of these were consumer-based fraud types. The other types of fraud were identified only 14 percent (imposter-based) to 20 percent (threat-based) of the time.
Demographics affected responses. For example, women were more likely to mention imposter-based fraud and less likely to mention identity-based fraud. College graduates were more likely to mention consumer-based fraud and less likely to mention threat-based fraud.
Those who did better on the financial-literacy quiz also showed greater fraud awareness across nearly all of the five types of fraud. Mentions of opportunity-based scams did not correlate to financial literacy to a statistically significant degree.
Conclusion. The report concluded that fraud awareness is unevenly distributed and that gaps can leave certain groups vulnerable. There is also an opportunity to strengthen people’s defenses against fraud by improving financial literacy.
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