Colorado’s financial fraud is getting worse, following a national trend at the worst possible time. The state’s population of fraud-susceptible seniors is growing. Economic headwinds are not as strong as they were. State and local budgets are not as robust as they were.

Financial fraud is a full-blown economic crisis in Colorado — one that drains billions from our economy and robs thousands of Coloradans of their livelihoods.

According to the latest report from the Common Sense Institute, financial fraud will strip Colorado of more than $5.1 billion in GDP this year alone. The economic ripple effect is broad. The impact amounts to $856 per Coloradan, whether you were personally targeted or not, if both reported and unreported crime is taken into account.

Fraud is increasing nationwide. In 2024, the FBI recorded 859,532 internet fraud cases nationwide totaling $16.6 billion in losses, which is a 33% increase from 2023. Meanwhile, the FTC logged 2.6 million fraud reports and $12 billion lost, which is $2 billion more than the previous year.

Colorado is no exception, and in some cases even worse. The Federal Trade Commission reports that 43,302 cases of financial fraud were filed in Colorado in 2024, totaling $216.5 million in reported losses. This is a staggering 299% increase since 2020.

These figures are likely much higher in reality since they only represent what’s reported. More often than not, victims of financial fraud keep silent out of embarrassment, shame or distrust in the system to do anything about it.

The Financial Industry Regulatory Authority estimates that only 14% of fraud is ever reported.

The Colorado economy is already feeling the ripple impacts, which extend far beyond simply a few hundred dollars missing from individual bank accounts. This is money no longer spent on goods and services. CSI’s modeling says only reported financial fraud in 2025 will cut Colorado’s GDP by $954 million in 2025, reduce personal income by $932 million, and eliminate 6,628 jobs statewide.

As though that 14% of reported crimes weren’t high enough, the unreported fraud kicks totals in to the billions. Losses grow to a $3.9 billion hit to personal income and the loss of 16,374 jobs, which is half a percent of all nonfarm jobs in Colorado. Fraud isn’t just theft. It’s a silent job killer.

None of this is a good outcome for the state of Colorado in the best of times, and Colorado’s current economic climate is not its best. As detailed in other CSI reports, Colorado’s key economic indicators like job growth, in-migration from other states, and retail sales growth have all slowed considerably from the highs of the mid-2010s. Colorado’s boom years have passed.

An aging population will make matters worse if financial fraud continues at its current pace. Colorado’s concentration of retirees and seniors is climbing and will continue to do so in the coming years, as fewer people move to Colorado and birth rates remain stubbornly low. Relative to other states, between 2010 and 2020, Colorado’s population in the 65+ age group grew at the second-fastest rate in the nation. The 65+ demographic pool is projected to grow by 48% between now and 2050, expanding this population by 489,740 individuals.

Financial fraud disproportionately affects older Coloradans. Coloradans over 60 account for 42% of reported fraud losses, which is more than just a few years ago. Not only are they swindled more frequently, but for higher stakes. Those between the ages of 60 and 69 lose an average of $6,595 per incident, compared to just $994 for fraud victims in their 20s.

Fraud is also more disruptive for seniors with fixed incomes. For seniors living on fixed incomes, these losses can mean losing the ability to pay rent, buy groceries, or afford medicine.

The technological progress of the past decade contributes to the problem, especially in high-tech Colorado. Consider one case highlighted in the report: two cryptocurrency ATM operators in Colorado allegedly allowed citizens — mostly over 60 — to transfer $20 million to scammers. The companies charged sky-high fees while failing to warn victims or stop suspicious activity. In the end, victims lost $20 million that could have otherwise circulated in our local economy.

CSI modeling shows that this single scam reduced state GDP by $31 million and cost 216 jobs.

Apart from its economic costs, widespread fraud has a deteriorating effect on a general sense of welfare and institutional faith. Victims often describe intense shame, depression, and anxiety. Trust in neighbors, financial and law enforcement institutions, and even loved ones can be permanently shattered. Families are forced into caregiving roles when a parent’s retirement savings are wiped out.

Fraud also drains public resources at a time when state and local budgets are feeling pinched. Law enforcement, courts, and social services all spend valuable time and money responding to fraud cases. The CSI report estimates that Colorado’s General Fund alone will lose $88 million in tax revenue this year because of fraud response.

Unfortunately, Colorado’s issues with fraud are worse than elsewhere.

Colorado ranks 18th in the nation for financial fraud incidence, with 1,260 reported cases per 100,000 residents. Thankfully, fraud here is not to the levels of Florida or Georgia, but the gap is narrowing.

In part, the state’s success puts it at higher risk. Fraudsters follow money.  Colorado’s mix of older retirees, booming digital economy, and high levels of personal wealth make it an attractive target.

Clearly, fraud is a sizable economic threat. Leaders should pay careful attention and search for ways to address it.

Fraud thrives in the shadows. We need widespread public education campaigns that go beyond generic “don’t click suspicious links” advice. Tailored outreach to seniors, immigrants, and young investors is essential. Institutions themselves can help staunch the bleed of money through fraud. Banks, crypto platforms, and payment apps can do more to flag suspicious transactions.

Law enforcement should be equipped. Fraud cases are notoriously complex and often cross state and international borders. Colorado must ensure that law enforcement has the tools, training and resources to pursue sophisticated fraudsters, whose complexity of operations rises above the level of petty thievery.

Leaders of state and financial institutions can aid the cause with more robust data, which begins with citizen reporting. The state needs simple, trustworthy reporting mechanisms. Victims must be assured their reports will not be met with public shame or retaliation.

Financial fraud, like other crime, has a much broader impact than simply to the victims’ persons or property. It is a structural threat to Colorado’s economy during an age in which that economy’s growth is less able to take the hit than a decade ago.

This silent siphoning of hard-won resources is part of a slate of threats to state financial stability. In 2025, fraud will quietly erase the contributions of some of Colorado’s largest industries. It will destroy more jobs than many major employers create, and do so while eroding mutual trust among citizen consumers and the companies and institutions they depend on for goods, services and support.

When billions of dollars vanish from our economy, it’s not just numbers on a spreadsheet. It is real jobs, real livelihoods, and real personal grievance. This is both tragic and civically unsustainable. The state can help, and has every reason to do so.

Kelly Caufield is the executive director for the Common Sense Institute.