The Federal Trade Commission (FTC) warned consumers recently that social media has become a “gold mine” for scammers, with around $770 million in losses being reported last year.
The commission said more than 95,000 people reported around $770 million in losses from fraud on social media in 2021. That was about one fourth of all fraud losses reported to them in 2021 and represented an “18-fold increase from 2017,” the agency said. By comparison, around $258 million was reported in losses to social media fraud in 2020, and in 2017 that number was only $42 million.
In a new data spotlight report, the FTC said investment scams on social media, such as “bogus cryptocurrency investments” led to the most total reported loss, followed by romance scams where scammers “sweet talk” a victim and eventually request money. In May of last year, the agency warned of a huge spike in cryptocurrency scams.
While investment scams and romance scams led to the largest amount of money being lost, online shopping scams were the most reported kind of scam to the FTC. The agency said 45% of reports about losing money in social media-based scams in 2021 were about online shopping. Typically, these reports were victims placing an order after seeing an ad, but never receiving the merchandise.
The FTC said when victims specified which social media platform they say the shopping scam on, “nearly 9 out of 10” said the platform was Facebook or Instagram….
