Personal Finance

The Biggest Consumer Complaints of the Year

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Identity theft continues to be a major concern for American consumers, accounting for more complaints in 2011 than any other type of fraud or scam, according to a report released Tuesday by the Federal Trade Commission.

It was the twelfth straight year that identity theft topped the list of consumer complaints. The number of ID theft-related complaints grew by 11 percent to nearly 280,000, the FTC reported.

“It’s logical,” says Adam Levin, founder of Credit.com and of Identity Theft 911, says of the FTC’s finding. “With unemployment high, with the level of hacker sophistication rising, with cutbacks to government enforcement, it only makes sense that identity theft would continue to be a major problem.”

Debt collection companies also remained unpopular, having received 180,928 complaints in 2011 and coming in second in the number of consumer complaints, just as they did in 2010. The number of complaints regarding prizes, sweepstakes and lotteries jumped 56 percent to just over 100,000, making it the third most-common type of complaint.

Another big change: banks and lenders, which didn’t even appear in the top-ten list of consumer complaints in 2010, came in at number four last year. The FTC received 89,341 complaints about lenders and banks, or five percent of the 1.8 million complaints lodged with the FTC in 2011.

The commission’s full report shows that the increase in identity theft complaints was caused by a large uptick in fraud related to government documents and benefits. Consumers’ stolen information was used for wage or tax fraud in nearly a quarter of all cases, compared to 12.7 percent of all cases reported in 2009.

Complaints regarding phone and mobile services also spiked. The number of complaints grew by 87 percent to about 70,000 in 2011. The findings reflect consumers’ vulnerability to scams involving their phones, Levin says.

“You can protect yourself,” Levin says. “Make sure your phone is password protected. Read all your statements. It’s all about awareness.”

According to the FTC, the top ten consumer complaints are:

  1. Identity Theft
  2. Debt Collection Complaints
  3. Prizes, Sweepstakes, and Lotteries
  4. Shop-at-Home and Catalog Sales
  5. Banks and Lenders
  6. Internet Services
  7. Auto Related Complaints
  8. Impostor Scams
  9. Telephone and Mobile Services
  10. Advance-Fee Loans and Credit Protection/Repair

Image: origami joel, via Flickr.com

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