Redesigned Federal Trade Commission website sees increased consumer reporting of fraud by 28%

New research has revealed that a revamp of a federal website for filing consumer complaints has led to a significant increase in public usage. More to the point, when the Federal Trade Commission (FTC) conducted a wholesale redesign of its website, which consumers can use to file complaints to the FTC, the number of complaints jumped by 28%.

The research study, published in the journal Marketing Science, is called “Amplifying Consumers’ Voice: The Federal Trade Commission’s Report Fraud Website Redesign.” The authors of the study are Michel Grosz and Devesh Raval of the Bureau of Economics in the FTC.

“We found that with the redesign of the website, consumer completion rates went up and consumers provided more detailed information,” says Raval. “Complaints became shorter and easier to read, which we believe meant that we were hearing from a greater cross-section of the population from all demographics and educational backgrounds. Consumers found that the new website was more accessible to them.”

In October 2020, the FTC redesigned its online interface for reporting scams and fraud in an effort to make the process easier to complete. The researchers believe that when the FTC broadened consumers’ online access to the complaint process and by engaging them more effectively, the federal agency was better able to examine patterns and trending data in the types of problems that were reported.

The FTC reports that more than five million consumers provided complaints, reporting having lost almost $9 billion from fraud in 2022 alone. Still, according to the researchers, most consumers do not tend to file complaints when they encounter serious issues.

“In FTC surveys on fraud victimization, only 5% of consumers affected by fraud say they complained to a government agency or the Better Business Bureau,” says Raval. “In previous work, I’ve found that very few victims of fraud complain except for cases in which consumers lose thousands of dollars on average.”

To conduct their research, the study authors used two machine-learning text-based approaches. They used a large language model (LLM) to produce certain categories of issues that consumers complain about using data on complaint texts. They were able to then predict the probabilities of each complaint category before and after the website redesign.

They used a topic modeling approach to assign individual complaints to a large set of topics and examined how the topics changed with the redesign.

“After the website redesign, we found that the largest increase in complaints centered on telemarketing and imposter scams, for which many consumers are exposed to the scam but few lose money,” says Raval. “Under topics, imposter scams and identity theft were issues that saw the largest increases after the redesign.”

As part of the website redesign, the FTC made the site more user-friendly on both laptop and smartphone applications. The new site featured a simpler design, shorter flow to complete a complaint and an improved process to classify the topic of complaints. In addition, the redesign emphasized how filing complaints benefited the wider community by helping to fight fraud.