The costs of consumer-facing cybercrime: An empirical exploration of measurement issues and estimates†

Abstract

Consumer-facing cybercrime is an increasing concern for individuals and societies. Nevertheless, current estimates of its costs are unreliable and there is no consensus on adequate measurement methods. This article presents a tailored survey instrument, which explicitly asks for monetary and non-monetary cybercrime losses and protection expenses. We collect representative data in a victimization survey of adult Internet users covering seven types of consumer-facing cybercrime in six selected EU member states. Victims are oversampled to increase the number of informative data points in the loss distributions. We use the loss data to evaluate different summary indicators regarding their robustness and precision in depicting the size of the cybercrime problem. We find that the distributions of victim losses and protection expenses are zero-inflated and skewed to the right. Aggregate victim losses are dwarfed by protection expenses at the societal level. A robust harmonized loss indicator allows for comparisons between crime types and across countries. Among the crime types studied, scams cause the severest impact on victims, as opposed to payment-related fraud. From the perspective of method development, our findings offer evidence-based insights to inform the instrument design and data analysis of future survey-based measurements of consumer-facing cybercrime.