There are almost as many types of fraud as there are victims of it. From Medicare and insurance fraud to Ponzi schemes and phishing scams, bilking people out of money through deceitful means is a frightfully common occurrence in our tech-heavy modern world.
Billions of dollars are lost every year to fraud, and while the financial toll is substantial, money isn’t the only thing lost when a person, institution, or government is taken for a ride and robbed. From the sense of responsibility and self-blame incurred to the health maladies that can also result, here are five hidden costs of financial fraud that affect those already reeling from the pain of its monetary effects.
About half of all financial fraud victims blame themselves for the fraud, and while assisting that Nigerian prince in order to make a little money on the side does seem incredibly foolish after thousands of dollars have gone missing from your bank account, beating yourself up over the experience only adds insult to injury.
Still, the feeling of responsibility is real, and it can be difficult to overcome. While going into a career to combat fraud is one way to alleviate the feelings of guilt and self-blame, it’s also helpful to remember that the fraud was the fault of the criminal behind the scam, and while being victimized doesn’t ever feel good, there’s no reason to blame yourself for someone else’s nefarious activities. Learn from the experience, and move on.
Roughly 50 percent of people who have been victims of fraud say the experience caused them extreme stress, and it’s no wonder. In addition to the work of “cleaning up” after fraud (monitoring accounts, filing police reports, repairing credit scores, recovering lost funds, etc.), the worry over being victimized again can create a scenario in which stress becomes a dominant feature of daily life.
Because chronic stress can lead to depression, health problems, memory loss, and other troubles, it can end up creating a negative loop where the extreme stress brought on by a fraud event triggers other stressful outcomes that then contribute to even more stress. If you’re experiencing stress due to a fraud event, talk to a therapist, take up yoga, or meditate to try and alleviate it.
In addition to stress, there are other negative emotional effects for financial fraud victims. The most common emotion experienced by fraud victims is anger, followed by regret. Anxiety can also arise as individuals and even businesses or institutions experience a “looking over your shoulder” effect that makes people feel as though danger is always lurking and ready to pounce.
Because of the resulting negative emotions, some people also experience difficulty sleeping and depression can even become a factor. Talk through your feelings with a trusted friend or professional to keep your emotions from overwhelming you.
4. Health Woes
While not all victims of financial fraud report suffering health woes, for those that do, it adds considerable insult to an already painful injury. You could be more susceptible to colds and flu as a result of a lowered immune system due to sleep loss and worry, or you may experience the manifold troubles that chronic stress can cause (obesity, Alzheimer’s disease, diabetes, hear disease, gastrointestinal problems, etc.).
Being the victim of financial fraud can wreak as much havoc on your physical health as it does your financial health. If you’ve experienced fraud, talk to your doctor about any health concerns that seem to crop up as a result.
5. Indirect Financial Costs
While the financial costs of the fraud itself is known and quantifiable, there are many indirect financial costs that can make the fraud event much more expensive than it seemed initially. Victims of fraud often have to go to great lengths to recover from the event, and many pay out of pocket for the following:
- Late fees or interest
- Bounced check or overdraft fees
- Lost work time or lost wages to combat the fraud’s effects
- Private investigator fees
- Costs of prescription medication to combat the negative emotional effects of the fraud
- Fees for doctors, psychiatrists, etc. as a result of negative mental health and physical health ramifications due to the fraud
- Lawyer fees, court costs, etc.
Financial fraud can feel devastating, and in some cases, it can be that way — at least financially. If you’ve been victimized, try and stay on top of these five hidden costs of fraud so that your recovery from the event can be total.