Scammers have long used various tactics to lure unsuspecting victims and steal their money. However, a new report from the Federal Trade Commission (FTC) has highlighted the true scale of these social media scams, as threat actors have stolen a staggering $2.7 billion from victims since 2021.
According to the report, these scams target the younger generation through websites, phone calls, emails, texts, or pop-up ads. Out of these, three types of scams were the most prevalent, with fraudulent online shopping transactions leading at 44%, while fake investment opportunities and romance scams represented 20% and 6% of the scams, respectively.
Shopping scams
In this era of dropshipping and affordable websites like Temu, it’s no secret that fake shopping scams are rampant. These scams primarily operate through social media platforms like Instagram and Facebook by creating fake ad pages for products or services and advertising them. And when a user orders a product, often clothing or electronic items, they usually receive nothing.
Additionally, considering the fact that the average loss per individual was around $100, the FTC advises users to thoroughly search for the company’s name along with terms such as “complaint” or “scam” before placing an order.
Investment scams
While shopping scams represent a higher percentage in terms of volume, investment scams account for the most money lost, constituting a significant 53% of the $658 million lost during this timeframe. These scams involve threat actors, creating an illusion of wealth on social media platforms like Instagram, enticing victims with promises of substantial financial gains. If a user buys into the illusion and wants to invest their money, these threat actors take the users to fake websites where they steal login credentials. In some cases, these investment coaches also offer fake courses on investment advice at high prices.
Romance scams
Perhaps the oldest trick in the book, romance scams have been around for a decade and rank second in terms of financial losses. Threat actors start by sending friend requests or random messages on social media platforms. And if the user shows interest, scammers quickly employ tactics such as love-bombing and showering victims with compliments before ultimately asking them for money for various reasons.
While there aren’t any foolproof ways to protect against such scams, the FTC recommends maintaining a private profile and avoiding responding to dubious messages from strangers.