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Last updated: April 7, 2012 12:11 am
A few weeks ago, some British friends told me that they would be coming to New York for Easter and needed a place to stay. Since my own apartment was already full with extended family, I suggested they look on the internet – and they duly booked a place via Craigslist.
It seemed ideal, at least in cyberspace: a mid-town address, a reasonable rental price and spacious rooms. But, sadly, it was also too good to be true. After my friends paid the deposit, the landlord vanished, with $1,200 of their money. The “dream” rental was actually an internet fraud perpetuated by a man named “Lester Gold”.
It is a sobering tale on several levels. First, and most obviously, it should serve as a warning to anyone else planning a holiday rental. Since this particular fraudster struck, I have been regaled with a host of similar tales from native New York friends: such stories, it seems, are common. No surprise, perhaps, given the city’s sky-high hotel prices, tourist influx – and the presence of platforms such as Craigslist which do not have any liability for what is advertised or posted there.
But amid all that scepticism, what is notable – and surprising – is that our faith in technology remains so high. Take a look, for example, at a recent 18-country survey from Edelman, the public relations agency. In the past five years, or since the financial crisis hit, public confidence in banks, government and most business has tumbled. Just 38 per cent of people now trust government, down from 51 per cent in 2008 – and a mere 45 per cent trust banks. However, faith in technology has remained entirely unchanged, with 79 per cent of those surveyed saying that they trust this sector.
And whereas financial analysts, CEOs and government officials used to be considered trusted sources of information, these days “a person like yourself” or “a regular employee” commands more trust. Vertical trust, it seems, has been replaced by a horizontal slant, as the public turns to their peer group for advice, via Facebook, Google+, Twitter or LinkedIn. To put it another way, while we no longer have faith in bankers, bureaucrats or estate agents, we are taking leaps of faith with our BlackBerries, iPads and laptops.
This horizontal trust does not, in itself, cause people to be swindled. For every gullible internet user out there, there are also dozens of others who are profoundly savvy. Nevertheless, the numbers are thought-provoking, even in hard-nosed, cynical New York. According to data compiled by the Internet Crime Complaint Center, in 2010 there were 14,689 cases of reported cyber fraud in the state of New York, which created $26.5m worth of losses, with an average swindle of $700. This was a fraction lower than the previous year, but more than double the level five years ago.
Just over 20 per cent of these frauds were for “non-delivery of merchandise” (such as paying for a flat that never existed), while 18 per cent of the losses were linked to identity theft, 13 per cent to auction fraud and 8 per cent to credit card fraud. And while many victims were tourists, particularly from Canada, the UK, Australia and India, the majority were Americans, often from New York. Americans and non-Americans alike, it seems, are prone to let down their guard online – probably because the sheer intimacy of the internet makes it feel seductively familiar. There is an implicit temptation to trust.
Of course, for my friends who suffered at the hands of “Lester Gold”, that trust is now shattered. The New York Police Department has told them that there is little point contacting the bank that handled “Lester Gold’s” account. Their best bet is to analyse the geographical source of the original internet postings (in this case Wisconsin), file a report with the police – and then lick their wounds.
In the meantime, however, this particular family has made an intriguing discovery. Precisely because these rental frauds keep happening, a class of companies is now springing up that try to offer a new form of security. Groups such as Airbnb, for example, have emerged in the past two years to match online renters and landlords – but via a central platform that forces everyone to post a set of videos, pictures and details online. The idea appears to be that if humans can connect face-to-face, via cyberspace, this will create new forms of trust.
It is a fascinating example of the way that seemingly impersonal, dehumanising technology keeps dancing with “the social”; and, of course, it is also a very cheering sign of the adaptive capabilities of free-market capitalism and entrepreneurs. Better still, I am pleased to say that these new systems work. My friends are now happily ensconced in a Brooklyn Airbnb rental, after Skyping with the landlady – even as “Lester Gold” is probably hunting for his next victims.
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