Global financial fraud losses hit an estimated $442 billion in 2025, according to INTERPOL’s March 2026 threat assessment — and behind every dollar in that figure is a fraudster. Not a statistic. A person, a business, or an institution that was deliberately deceived and lost something of real value as a result.
A fraudee is the party that suffers fraud — the victim of deception, not the perpetrator. The term is gaining momentum in cybersecurity, fintech, and consumer protection circles as the industry shifts focus from catching fraudsters to understanding, supporting, and better protecting the people they target.
This article explains what a fraudee is, how the term is used, who is most at risk in 2026, and what the latest research reveals about fraud types, psychological impact, and legal protections.
Fraudee: Definition and Linguistic Origin
The word follows a well-established English pattern. The suffix “-ee” attached to a root word denotes the recipient of an action. A payee receives payment. A trainee receives training. An employee is employed by another. A fraudee, by the same logic, is the one who receives — or suffers — fraud.
The term does not yet appear in major legal dictionaries. Courts typically use “fraud victim,” “aggrieved party,” or “complainant.” But fraudee is gaining traction in consumer advocacy, fintech research, and cybersecurity reporting, partly because it carries less implied passivity than the word “victim.” It names what happened to someone as a fact, not a character trait.
Fraudee vs. Fraudster: The Core Distinction
These two terms sit on opposite ends of the same criminal event.
A fraudster is the individual or group that commits the deception — lying, manipulating, impersonating, forging, or exploiting trust to obtain something of value. A fraudee is the party on the receiving end: the person, company, or organization that trusted, was deceived, and as a result lost money, data, identity, or legal rights.
This distinction carries real weight in legal proceedings, insurance claims, and regulatory enforcement. Courts and regulators increasingly need vocabulary that cleanly separates perpetrator from victim — particularly as fraud becomes more automated and the lines of liability grow more complex.
Who Can Become a Fraudee?
The honest answer: anyone. But research identifies clear patterns in who fraudsters target and why.
Individual consumers
Individual consumers face the widest exposure. TransUnion’s survey across 18 countries found that 48% of global consumers reported being targeted by email, online, phone call, or text messaging fraud between February and May 2025, while 52% were unaware — indicating significant under-recognition of active targeting. Among those who recognized they were targeted, the most common methods were smishing (fraudulent texts), phishing (fraudulent emails), and vishing (fraudulent voice calls).
Businesses
Businesses are high-value fraud targets. According to TransUnion’s H2 2025 report, companies worldwide lost an average of 7.7% of annual revenue to fraud over the past year — an estimated $534 billion across the 1,200 business leaders surveyed. In the US, that figure reached 9.8% of revenue, a 46% increase from the prior year.
Age is not the defining factor many assume. The FTC found that adults aged 20–29 reported losing money to fraud in 44% of cases — nearly double the 24% rate reported by those aged 70–79. While younger people fall victim more frequently, the financial loss per incident is significantly higher for older adults. Both groups are targeted, but through different methods and for different reasons.
The Fraud Types That Create the Most Fraud
Phishing and Social Engineering
Phishing remains the dominant method for creating fraud at scale. Social engineering has evolved in 2025 into what researchers now describe as “human hacking” — a discipline that combines advanced psychological manipulation with AI-enhanced realism, making it fundamentally harder to detect than traditional phishing.
Account Takeover Fraud
In the US, account takeover fraud emerged as the most damaging fraud type for businesses, responsible for nearly one-third of all reported fraud losses. Digital account takeover volume grew 21% globally from the first half of 2024 to the first half of 2025 — and surged 141% from 2021 to 2025.
Synthetic Identity Fraud
This is one of the fastest-growing categories, and uniquely damaging because it targets real people’s data without their knowledge. Synthetic identity document fraud surged 311% between Q1 2024 and Q1 2025. Fraudsters combine real and fabricated personal data to build fictitious identities, then exploit them for credit, benefits, or account access — often leaving the real person to deal with the consequences.
Pig-Butchering Scams
Pig-butchering is now one of the most financially destructive fraud types globally. These scams combine romance fraud with investment schemes — fraudsters build emotional trust over weeks or months, using feigned affection and small financial gains before attempting to extract the victim’s entire savings. In 2025, these operations shifted to using autonomous AI chatbots capable of managing multiple “characters” simultaneously. A single fraudster in a pig-butchering scheme can lose hundreds of thousands of dollars.
Business Email Compromise (BEC)
In BEC fraud, an attacker impersonates a trusted contact — an executive, supplier, or colleague — and tricks an employee into transferring funds or sharing credentials. The Americas and the Caribbean recorded a 40% increase in fraud cases, with one case involving a Massachusetts-based workers’ union that lost $6.4 million in a BEC scheme, with funds traced to seven US bank accounts.
Robocalling and Voice Fraud
Global losses to robocalling fraud peaked at over $80 billion in 2025, driven by increasingly sophisticated AI-based voice scams that automate responses in real time to mimic trusted individuals. A fraud victim receiving one of these calls faces an interaction that may feel indistinguishable from a call with their bank.
The AI Threat: How Agentic AI Is Changing Who Becomes a Fraudee
This is the defining shift in fraud for 2026, and it deserves direct attention.
Agentic AI refers to autonomous AI systems capable of planning and executing multi-step tasks without human involvement. INTERPOL estimates that AI-enhanced financial fraud is 4.5 times more profitable than traditional methods, and “agentic AI” systems can now autonomously plan and execute complete fraud campaigns — from identifying targets to sending ransom demands.
What this means in practice: a fraudee no longer necessarily interacts with a human fraudster at any point. They may be targeted, engaged, manipulated, and defrauded entirely by an automated system that scales to thousands of simultaneous victims.
Experian’s 2026 fraud forecast warns that emotionally intelligent bots powered by generative AI will carry out complex scams — including romance fraud and relative-in-need schemes — without any human operator. These bots respond convincingly, build trust over time, and manipulate victims with psychological precision.
Experts note that criminal groups are adopting these tools faster than financial institutions can respond, and that the apparent levelling-off in reported fraud losses in some markets actually masks a shift in tactics — from high-volume, low-yield phishing to precision-targeted, high-yield social engineering campaigns.
The implication for fraudees: the standard advice to “look for signs something feels off” is becoming less reliable. An AI-generated conversation, voice call, or investment relationship can now closely mimic legitimate human interaction.
The Psychological and Financial Impact on Fraudees
The financial loss is only part of what a fraudee experiences.
INTERPOL has stated directly that the cost of financial crime is not only monetary — it affects victims’ life savings, their dignity, and in the most severe cases, their lives. Victims frequently face long-term psychological harm, including shame, isolation, and a breakdown of social trust.
Fraud researchers have documented that fraud victims face an elevated risk of PTSD following significant fraud events, and that the period immediately after a fraud incident creates a specific vulnerability known as “secondary deception” — where fraudsters or other bad actors re-target the same individual during the psychological window of distress and reduced judgment.
This secondary targeting pattern is important to understand. A fraudee who has just lost money is often contacted again — by fake “fraud recovery” services, impersonators posing as law enforcement, or platforms claiming they can retrieve lost funds. These follow-on scams are designed specifically for people who are already in a vulnerable state.
Legal Rights and Recovery Options for Fraudees
Knowing your options after becoming a fraud victim determines how much, if anything, can be recovered.
Criminal vs. civil routes. Fraud is a criminal offense, but a fraudee also has the right to file a civil lawsuit against the fraudster. In civil proceedings, the standard of proof is lower than in criminal court — guilt by a preponderance of evidence rather than beyond a reasonable doubt. If successful, a court can order the defendant to pay restitution.
Bank reimbursement. Many financial institutions will reverse unauthorized transactions if reported quickly. The window varies by institution and jurisdiction. Reporting within 24–48 hours significantly improves the outcome.
Regulatory protections. The landscape varies considerably by region:
- UK: A mandatory reimbursement scheme for Authorized Push Payment (APP) fraud was introduced, requiring banks to compensate victims. However, experts note that mandatory reimbursement schemes have provided victim support without reducing case volumes, signaling that they address consequences rather than causes.
- EU: The EU’s PSD3 and Payment Services Regulation, both expected to strengthen fraud protections, have slipped into 2027, raising concerns that the policy response is falling behind the speed of technological risk.
- US: The FTC provides reporting channels and maintains a national fraud database. Fraudees can report at reportfraud.ftc.gov and request credit freezes through the three major bureaus.
Credit freeze. Anyone who suspects they have been targeted or victimized should check their credit reports and consider placing a freeze on their credit files with each of the major credit bureaus. A freeze prevents new credit accounts from being opened in the fraudee’s name while the investigation proceeds.
Mistakes That Lead to Becoming a Fraudee
These are not failures of intelligence — they are the specific psychological triggers that modern fraud is engineered to exploit.
1. Responding to manufactured urgency
Fraudsters create artificial time pressure to bypass rational evaluation. Real banks and government agencies do not demand immediate action within minutes or hours under threat of account suspension or legal consequences.
2. Trusting channel authenticity
An email carrying a familiar logo, a caller ID showing a known number, a website with “https” — none of these confirms legitimacy in 2026. Caller ID spoofing, email domain spoofing, and cloned websites are standard tools.
3. Sharing OTP codes
A one-time password or SMS verification code sent to your phone exists for one purpose: to confirm it is you. No legitimate organization will ever ask you to read that code aloud. Doing so gives the fraudster direct access to your account.
4. Overriding your own bank’s security prompts
Modern fraudsters are now actively coaching fraud victims on how to override their bank’s own security warnings — posing as bank representatives and instructing victims to dismiss fraud alerts as “false positives” in order to push through a transfer. If you are being coached to ignore a security warning, stop.
5. Acting quickly during emotional conversations
Whether it is a distressed family member, a romantic partner, or an urgent investment opportunity — decisions made during heightened emotion are exactly what fraud is designed to produce. Pause, verify through a separate known channel, and act only then.
How to Protect Yourself From Becoming a Fraudee
1# Use app-based multi-factor authentication
App-based MFA (such as an authenticator app) is substantially harder to compromise than SMS-based verification, which is vulnerable to SIM-swapping.
2# Monitor your credit
Set up alerts for new credit inquiries and review your credit report at least once per quarter. Many fraud victims discover synthetic identity fraud months or years after it begins — earlier detection limits the damage.
3# Verify through a separate channel
If you receive any request involving money, credentials, or personal data — regardless of how convincing it appears — verify it by contacting the organization directly through their official contact details, not through any link or number in the original message.
4# Be skeptical of AI-enhanced communication
Voice cloning tools can replicate a person’s voice from just a few seconds of audio, and deepfake video calls impersonating law enforcement, executives, and family members are now documented fraud methods. Any unexpected financial request — even in a familiar voice — warrants independent verification.
5# Report immediately
Report to your bank, your national fraud authority (FTC in the US, Action Fraud in the UK, your national cybercrime agency elsewhere), and your credit bureaus. Even if no loss occurred, the report contributes to investigations that protect others.
Note on Fraudee.ai: Fraudee.ai is an unrelated AI-based fraud prevention platform focused on recruitment screening. It shares the term but has no connection to the general definition discussed throughout this article.
Conclusion
The term fraudee does more than fill a linguistic gap — it signals a necessary shift in how fraud is understood and addressed. For too long, public attention has centered on the fraudster: their methods, their technology, their networks. The fraudee has been a footnote.
With financial fraud now ranking among the top five global crime threats and a 54% rise in fraud-related activity from 2024 to 2025, that framing is no longer adequate. The scale demands attention to the people at the center of these events — their rights, their recovery, and the specific vulnerabilities that fraud is engineered to exploit.
That exploitation has reached a new level. Agentic AI means a fraudee may face an autonomous, psychologically sophisticated system designed to manipulate them — with no human fraudster involved at any stage. Awareness of the term, the patterns, and the available protections is not a guarantee of safety. But it is the starting point.