Surge of Scams Caused by Social Media

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Viviana Pena

In a recent report published by the Federal Trade Commision, it was reported that $770 million was lost in social media scams in 2021. This is about 18 times higher than the loss in 2017, which $42 million was lost in social media scams. 

Investment scams caused the highest amount of losses, with many people stating that they were contacted via social media. These investment scams involved investments like stocks, bonds and cryptocurrency, but also investment advice. People were even scammed out of art and precious metals. These investment scams totaled 37 percent of all social media scams, with the total worth of the losses were $285 million. The total loss of investment scams amounted to 60 percent of the total loss caused by social media. 

Another way people lost money was through romance scams. The way that these scams play out is that the scammer will usually send a friend or follow requests, talk to the victim of the scam then ask for money. The FTC recommends that if someone appears on your social media and rushes you to start a friendship or romance, to slow down.” As well as never sending money to someone you haven’t met in person in order to prevent getting scammed. 

Unfortunately, about 95,000 people claimed that they were scammed via social media due to product advertisements. Most of these scams came from online shopping. About 45 percent of all social media scams came from people buying from advertisements on social media apps, like Facebook and Instagram and that the product never came. 

Fortunately, the FTC gave recommendations to prevent future scams from happening. For example, people should limit who can see your posts and information on social media, opt out of targeted advertising, and if a friend asks for money, call them beforehand in case they were hacked. They also recommend searching up companies before buying products.