FTC: Americans lost $770 million from social media fraud surge

Americans are increasingly targeted by scammers on social media, according to tens of thousands of reports received by the US Federal Trade Commission (FTC) in 2021.

As revealed by the FTC, over 95,000 US consumers reported losses of roughly $770 million after getting scammed on social media platforms.

This amounts to approximately a quarter of all losses to fraud reported in 2021, showing a massive 18-fold increase over 2017 reported losses and more than double compared to 2020.

“More than one in four people who reported losing money to fraud in 2021 said it started on social media with an ad, a post, or a message. In fact, the data suggest that social media was far more profitable to scammers in 2021 than any other method of reaching people.” the FTC said.

“It’s a low-cost way to reach billions of people from anywhere in the world. It’s easy to manufacture a fake persona, or scammers can hack into an existing profile to get ‘friends’ to con.”

Top social media scams of 2021

The most profitable social media scams were those promoting bogus investment opportunities, with more than half of reports in 2021 mentioning money and cryptocurrency lost to promises of huge returns.

Romance scams were the second most profitable fraud on social media after reaching record highs during the last years.

However, the most significant number of scam reports linked to social media were sent by people who lost money to online shopping scams where marketed products were not delivered.

“In nearly 70% of these reports, people said they placed an order, usually after seeing an ad, but never got the merchandise,” the FTC added.

“Some reports even described ads that impersonated real online retailers that drove people to lookalike websites.”

How to avoid getting scammed

Based on the social media platform identified in the reports of investment, romance, and online shopping scams, the most popular platforms among fraudsters were Facebook and Instagram.

While, together, investment scams, romance scams, and online shopping fraud accounted for more than 70% of all reported losses linked to social media scams last year, there are many other types of social media fraud, with new ones surfacing all the time, according to the FTC.

FTC shared the following tips to avoid getting scammed on social media:

• Limit who can see your posts and information on social media. All platforms collect information about you from your activities on social media but visit your privacy settings to set some restrictions.
• Check if you can opt-out of targeted advertising. Some platforms let you do that.
• If you get a message from a friend about an opportunity or an urgent need for money, call them. Their account may have been hacked – especially if they ask you to pay by cryptocurrency, gift card, or wire transfer. That’s how scammers ask you to pay.
• If someone appears on your social media and rushes you to start a friendship or romance, slow down. Read about romance scams. And never send money to someone you haven’t met in person.
• Before you buy, check out the company. Search online for its name plus “scam” or “complaint.

In November, the FBI also alerted online shoppers that they risk losing over $53 million to holiday scams after warning Americans in April 2020 that sharing personal info online will only help scammers. 

Source: https://www.bleepingcomputer.com/news/security/ftc-americans-lost-770-million-from-social-media-fraud-surge/