Social Media Fraud gets scammers big money

As if there weren’t enough points piling up in the negative column for social media, the Federal Trade Commission has recently released a report revealing that scams run through social media platforms are netting big money for fraudsters. According to the FTC, social media con jobs cost Americans three-quarters of a billion dollars in 2021 ($770M) and accounted for over a quarter of the total fraud claims made that year. This is a 17-fold increase since 2017, and double what was reported in 2020. The top 2 money-makers? Investment scams and online romance swindles.

What this means for you.

For a very large percentage of our population, social media has become a staple of their daily lives, even more so during the pandemic and the various stages of lockdown that have washed over the country. It is well documented how platforms like Facebook are designed to create and reinforce echo chambers and information bias, which in effect creates an audience that is predisposed to unreasonably trust any content that appears in their “bubble”. While it may seem blasphemous to think of them as clever or learned, you can bet that scammers are reading these same papers to use this knowledge to their advantage

As a savvy business professional, you probably already know well enough to distrust investment knowledge received from someone in your Facebook feed who isn’t a known and licensed financial advisor (Right? RIGHT?!?), but in the day and age of social distancing and Zoom Cocktail Parties finding romance online doesn’t seem so farfetched, especially since online dating has been around for decades now. Both are huge moneymakers for scammers, and platforms like Facebook and Instagram are ripe hunting grounds with a never-ending supply of targets.

Unfortunately, given how easy it is to create a fake social media account, or to hijack a legitimate one, the truly savvy online traveler will have to wander the social media lands with eyes wide open, wallet in a zipped-up pocket, and a guarded heart. These are not apocryphal stories or urban legends. I have personally counseled at least half a dozen very intelligent and savvy adults through social media scams purely because the platforms are designed to lull people into a false sense of security, primarily so that they never consider leaving. As with anything consumed without moderation, this can lead to harm: financial, emotional and sometimes even physical.

The FTC has assembled guidelines for protecting yourself in social media (at the bottom of the short article). Perhaps some of these look familiar:

• 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.”

Image courtesy of Stuart Miles at FreeDigitalPhotos.net