Many believe the elderly are most often “taken” by con artists, but recent surveys reveal the stereotype is inaccurate.

According to research from the Better Business Bureau (BBB), “Millennials are actually more vulnerable to scams than Baby Boomers.”

Fraud affects 25% of households in North America annually. The cost to consumers is $50 billion, “yet most consumers believe they are invulnerable.”

The truth is, all consumers are at risk. But BBB research shows “younger and more educated individuals are actually the most likely to be scammed.”

The reason? “Optimism bias.” This is a perception that others are more likely to be victimized due to their propensity to engage in risky behavior and ignore words of caution.

The reality is, seniors are less likely to get captured because they are aware they are potential targets—they do not suffer from the bias.

Facts of note:

• Of fraud reports filed, 89% of people age 65+ realized a scam in progress. Eleven percent lost money.
• Consumers ages 18 to 24 were more than three times as likely to miss scams, and 34% lost funds.

These findings hold important implications for financial institutions. Notes Christopher DeAngelis, head of Global Fraud and Strategy Operations at Citi Prepaid Cards, the biggest challenge for the banking industry in fighting fraud among millennials is “ownership awareness. Millennials seem to have the mindset that fraud is strictly the bank’s problem.”

This is detrimental to the institution not only because of financial losses incurred, but also because “Millennial Customers Will Flee If Their Bank Accounts are Hacked,” notes cnbc.com. Indeed, a FICO survey shows 29% of millennials will dump their financial provider after a problem, versus 22% of the population as a whole.

Financial providers must take seriously the fraud problems millennials confront. Helping them to overcome prevailing “optimism bias” and informing about actions that put them at special risk will help provider and consumer alike.

This week, discover fraud growth trends for the millennial cohort, identify behaviors that make them particularly susceptible, and learn to combat the problem.

‘There is no sadder sight than a young pessimist.’ –Mark Twain

Several recent studies shed light on the problem of fraud in the millennial generation.

First, Microsoft weighs in with survey results surrounding tech support scams. Survey data reveals “over 50% of the people that fell for tech support scams in the past year were millennials,” says a Softpedia article. Those ages 36 to 55 comprised 34% of those scammed, and the elderly made up 17% of tech support fraud victims.

The Norton Cybersecurity Insights Report also notes the disturbing fraud trend for this generation. “Overly confident, digital-native millennials are the most vulnerable to online crime,” and 44% have fallen prey to online crime in the previous year.

Millennials are least apt to accept responsibility for securing personal data, and “nearly half rely on banks and credit card companies to protect them after a hack.”

Thirty-one percent of millennials admit they would share passwords, compared to 15% of boomers. Only 16% of boomers have experienced online crime in the last year.

A TransUnion study shows 49% of millennials “are extremely or very concerned about cybercrime,” but most do not protect themselves.

Eighty-six percent of the cohort keep bank information on their phones, and 84% consult their financial data via public Wi-Fi, making them vulnerable to ID theft.

Sixty-seven percent fail to lock their devices.

North of the border, “Millennials Are Biggest Fraud Victims in Canada,” per an Equifax poll, and comprise 50% of those scammed.

“Millennials rely heavily on technology for most of their day-to-day activities,” says John Russo, Equifax Canada chief privacy officer. They are susceptible to enticements like work-from-home scams and free ring tone downloads.

“The younger generation just automatically clicks,” says Russo.

‘Any informed borrower is simply less vulnerable to fraud and abuse.’ --Alan Greenspan

The optimism bias may be influential in the level of risk millennials take in that they feel invincible and lack awareness when scams are in process.

The literature reveals specific behaviors of this cohort that make them particularly vulnerable, and identify potential for education and awareness.

“Millennials tend not to think twice when they’re asked for information,” notes an article at International Business Times. The story reports on a Gallup poll that indicates the millennial sharing attitude prevails as they believe companies protect their data.

“This naïve belief has a variety of causes, such as millennials’ upbringing, inexperience and apathy,” and the likely consequence is fraud.

A GOBankingRates post enumerates “5 Ways Millennials Are In Danger of Bank Fraud.”

They include:

1. Online sharing of personal data;
2. Use of debit cards over credit cards;
3. Accessing bank information on public Wi-Fi;
4. Mobile shopping without benefit of virus protection; and
5. Tendency to trust and share sensitive information with family and friends.

An article at First Republic Bank adds to the list of ways millennials make themselves vulnerable: They fall prey to robocallers; reply to fake job ads; and are apt to be duped in charitable donation rip-offs.

Millennials have “burning desire to help people in need” and may not question validity of charities that approach them, who may steal contributions; IDs; or credit card information.

‘Nothing awakens the conscience like a lot of money.’ --P. Sainth, reporter

What can be done to help millennials navigate the murky, scam-filled waters?

The BBB says a three-pronged approach is required. First, recognize that con artists are invisible and many live on the Internet, disguised as legitimate businesses or trusted entities.

Those who have been victimized can “leverage technology, crowdsourcing, and altruism” because “the voices and stories of others have the potential” to rid shame and stigma: Share the message that anyone can become a target.

Second, it is important to educate millennials about the optimism bias. This will create awareness to vulnerability and foster empowerment to prevent fraudulent outcomes.

Finally, the BBB identifies two factors victims name as important in crime avoidance: Knowledge of scams and methods cons use. Providing “pre-emptive information” is “highly protective,” notes the Bureau.

Consumers can perhaps best “leverage technology, crowdsourcing, and technology” by reporting scams. Another interesting way to maintain awareness is to check incidence of scams in your area using the BBB Scam Tracker.

A good, healthy dose of skepticism is necessary for every consumer to keep a step ahead of fraud. Help spread the word that no one is invincible—everyone is susceptible.

LORA BRAY is an information research analyst for CUNA’s economics and statistics department. Follow her on Twitter via @Bray_Lora and visit the CUNA blog, The Research Roundup: Economic Perspectives.