FINRA Reveals Fraud Victims Suffer Stress, Anxiety and Depression
Recently, the FINRA Investor Education Foundation issued a new research report about the impact of financial fraud on its victims. FINRA’s report revealed that nearly two thirds of self-reported financial fraud victims experienced at least one non-financial cost of fraud to a serious degree—including severe stress, anxiety, difficulty sleeping, and depression. FINRA Foundation’s research examines the broader psychological and emotional impact of securities and other forms of financial fraud.
“Financial Fraud’s effects linger and cause distress well after the scam is over. For the first time, we have data on the deep toll that fraud exerts on its victims, and the results are sobering. This new research underscores the importance of the FINRA Foundation’s work with an array of national, state and local partners to help Americans avoid fraud, and assist consumers who have been defrauded,” said FINRA Foundation President Gerri Walsh.
Non-Traditional Costs of Financial Fraud found that:
- Nearly two thirds (65 percent) reported experiencing at least one type of non-financial cost to a serious degree; and
- The most commonly cited non-financial costs of fraud are severe stress (50 percent), anxiety (44 percent), difficulty sleeping (38 percent) and depression (35 percent).
Non-Traditional Costs of Financial Fraud found that, beyond the psychological and emotional costs, nearly half of fraud victims reported incurring indirect financial costs associated with the fraud, such as late fees, legal fees and bounced checks. Twenty-nine percent of respondents reported incurring more than $1,000 in indirect costs, and 9 percent declared bankruptcy as a result of the fraud.
Additionally, nearly half of victims blame themselves for the fraud—an indication of the far-reaching effects of financial fraud on the lives of its victims.
The FINRA Foundation’s survey was administered online in August of 2014, and 600 self-reported fraud victims responded to the survey. Non-probability quota sampling was used to obtain the sample, and respondents were 25 years of age or older. A pure probability sample of this size would have an estimated margin of error of four percentage points at the 95 percent confidence level. As in all survey research, there are possible sources of error, such as coverage, nonresponse and measurement error that could affect the results. Additional methodological information can be found in the full report.
For further information, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.
Hamilton & Associates | Securities Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855