Special Report

Ten States With the Most Fraud Complaints

5. Delaware
> Complaints per 100,000 population: 673.4
> Total complaints: 6,234 (10th least)
> Identity theft complaints per 100,000: 81.1 (11th most)
> 2007-2012 home value change: -5.3% (23rd worst)

Nearly one in five consumer complaints of identity theft in Delaware were for phone and utilities fraud, in which new accounts are opened in other people’s names, more than in most other states. Residents also reported a high level of imposter scams, complaining of scammers pretending to be friends, family or charitable organizations. Twenty-six percent of complaints were for aggressive debt collectors or predatory lending practices, the most commonly reported complaints in Delaware outside of identity theft. The cost of scams per victim in the state was $3,754 in 2013, more than in all but two other states.

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4. Michigan
> Complaints per 100,000 population: 676.7
> Total complaints: 66,964 (6th most)
> Identity theft complaints per 100,000: 97.1 (tied for 4th most)
> 2007-2012 home value change: -24.4% (5th worst)

Unlike many other states with high incidents of fraud, Michigan residents had less debt than most Americans. For example, the average auto loan debt in Michigan was just $13,857 as of January of this year, the lowest in the nation. While residents may not have as much to lose as those in other states, they were among the hardest hit by the financial crisis and are likely still vulnerable to fraud. Home values fell by 24.4% between 2007 and 2012, more than double the nationwide decline. The state’s 8.3% unemployment rate last year was also one of the worst in the nation.

3. Nevada
> Complaints per 100,000 population: 719.1
> Total complaints: 20,062 (25th least)
> Identity theft complaints per 100,000: 97.1 (tied for 4th most)
> 2007-2012 home value change: -51.6% (the worst)

There were 20,062 reports of fraud, identity theft and other complaints in Nevada last year. More than 2,000 of these involved debt collection. Average mortgage and auto debt in particular were among the highest in the nation as of January, according to Credit Karma. Nevada may have been the state hit hardest by the housing crisis, with home values dropping by 52% between 2007 and 2012. The state is still recovering from the crisis today. One out of every 46 homes was in foreclosure last year, trailing only Florida. To make matters worse, the state’s 9% unemployment rate was also among the worst in 2013. The housing crisis and recession led to many residents feeling severe financial pressure. This likely contributed to higher incidence of fraud.

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2. Georgia
> Complaints per 100,000 population: 755.8
> Total complaints: 75,523 (5th most)
> Identity theft complaints per 100,000: 134.1 (2nd most)
> 2007-2012 home value change: -13.5% (12th worst)

There were 13,402 reports of identity theft, or 134.1 complaints per 100,000 Georgians, last year. More than half of all identity theft complaints were classified as government documents or benefits fraud, a higher percentage than in any other state except Florida. Aggressive debt collection and predatory lending accounted for a large number of other complaints. According to Credit Karma, student loan debt in the state is second highest nationwide, at $32,283 on average as of the beginning of this year.

1. Florida
> Complaints per 100,000 population: 997.8
> Total complaints: 195,103 (2nd most)
> Identity theft complaints per 100,000: 192.9 (the most)
> 2007-2012 home value change: -35.7% (3rd worst)

Stealing Social Security numbers to collect phony tax returns is on the rise in the United States, but nowhere more than in Florida. Of the nearly 40,000 complaints of identity theft in Florida last year, more than half were related to government documents and benefits. The housing market may also be placing residents at greater risk. Florida was among the hardest hit by the housing crisis, with home values plummeting more than 35% between 2007 and 2012. Last year, one out of every 33 homes was in foreclosure, the worst rate in the nation.