Could rising scams be reducing other forms of crime and vice?

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The Rise of Financial Scams May Be Correlated with a Decline in Other Crimes and Vices

The increasing prevalence and profitability of financial-digital scams may be leading to a reduction in other forms of crime and social vices. This phenomenon is driven by market forces that favour the higher returns offered by cyber fraud over traditional illicit activities. Malaysia, for instance, experienced significant financial losses due to scams in 2023, highlighting the scale of this evolving criminal landscape.
Financial Losses from Scams are Substantial

Malaysia incurred losses amounting to RM54.02 billion in 2023, a figure equivalent to three percent of its Gross Domestic Product (GDP). This substantial economic impact underscores the significant scale of financial-digital scams. Across East and Southeast Asia, the United Nations Office on Drugs & Crimes (UNODC) estimates that cybercrime syndicates will inflict US$37 billion in losses by 2025, indicating a regional trend of escalating cyber-fraud.
Market Forces Drive a Shift Towards Scams

The immense profitability of scam operations, which can extract vast sums of money, appears to be outstripping the revenue generated by "traditional" crimes and vices. This disparity incentivizes individuals involved in other illicit activities to transition into scamming, driven by basic market principles of seeking higher returns. For example, individuals previously engaged in activities like illegal gambling or prostitution might find scam syndicates more lucrative.
Online Thievery Replaces Physical Criminal Practices

The evolution of digital platforms has created parallels between legitimate commerce and criminal enterprises. Just as online ordering has impacted traditional walk-in dining establishments, online thievery is suggested to be replacing physical criminal practices. This shift reflects a broader trend where digital mediums offer a more efficient and potentially less risky avenue for illicit financial gains compared to face-to-face criminal activities.
A Continuous Battle of Wits Between Scammers and the Public

The landscape of financial-digital scams is characterized by an ongoing technological and strategic "war" between scammers and the public, akin to the dynamic between AI deepfakes and counter-deepfake technologies. Scammers constantly innovate to create more convincing fraudulent schemes, while efforts are made by various entities, including government bodies and software companies, to develop methods for detection and resistance. This includes banks implementing stricter checks for fund transfers, which, while potentially inconvenient for legitimate users, may be a necessary measure to curb fraud.

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Could rising scams be reducing other forms of crime and vice?

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