One in four scams reported to the Federal Trade Commission (FTC) since 2021 started on social media, with over $2.7 billion in losses reported since then.
In a report on Oct. 6, the FTC said while this figure is staggering, it represents a “small fraction of the public harm” caused by scams.
“Social media gives scammers an edge in several ways,” the FTC said in its report. “They can easily manufacture a fake persona or hack into your profile, pretend to be you, and con your friends. They can learn to tailor their approach from what you share on social media.”
Besides social engineering attacks, scammers can also use social media advertising tools to identify targets based on their age and other personal details.
It “costs them next to nothing to reach billions of people from anywhere in the world,” the FTC said.
Social Media Scams
Online shopping scams accounted for 44 percent of all social media fraud reports in the first half of 2023, the FTC said. Scammers advertise clothing, electronics, and other products on platforms like Facebook and Instagram. They then swindle unsuspecting targets who attempt to purchase the items.
“Most of these reports are about undelivered goods, with no-show clothing and electronics topping the list,” the FTC said.
While online shopping scams top the list, the type of scams with the largest share of monetary losses are investment scams. In the first half of this year, over half of the money lost to fraud on social media went to investment scams. Cryptocurrency is usually at the center of social media investment scams.
“To draw people in, these scammers promote their own supposed investment success, often trying to lure people to investment websites and apps that turn out to be bogus,” the FTC said. “They make promises of huge returns and even make it look like an “investment” is growing. But if people invest, and reports say it’s usually in cryptocurrency, they end up empty-handed.”
Young People are the Top Targets
While scammers target people of all ages on social media, young people make up a large percentage of the victims in reported cases. In fraud cases reported in the first half of 2023, 47 percent of people aged 18-19 said social media was the point of contact with scammers, while the figure was around 38 percent for people aged 20-29.
To combat the rising tide of social media scams, the FTC recommends several precautionary measures. These include tightening privacy settings on social media platforms, verifying unexpected messages about financial opportunities, and thoroughly researching companies before making any purchases.
The FTC also advises the public to be wary of online romance scams.
Scams are Not Limited to Social Media Platforms
Scammers don’t only operate on social media, they’re everywhere. In August, the U.S. Customs and Border Protection (CBP) said scammers are posing as agents to trick victims into revealing sensitive personal information about themselves. This week, the FBI also raised alarms about a scam dubbed “The Phantom Hacker” targeting older individuals.
We recommend exercising caution on social media platforms and learning how to stop signs of a scam. Read our guide to Facebook scams and Instagram to learn more.
We also recommend being skeptical of phishing emails, using secure passwords, and enabling two-factor authentication on your accounts for optimum security.
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