Social media use can provide a slew of opportunities — from furthering your career to cataloging memories to finding love and friendships. However, it can also offer opportunities for criminals, like scamming and defrauding.
According to a new report by the Federal Trade Commission, one in four individuals who reported losing money due to fraud since 2021 said that the scam began on social media.
The cumulative losses reported from these schemes during the same period have amounted to $2.7 billion, the report found, eclipsing any other communication method by a considerable margin. By comparison, the losses from websites or apps were $2 billion for the same period, phone calls were $1.9 billion, and email was $0.9 billion.
While social media scams affect all age groups, the report found that it’s not senior citizens who are experiencing the most substantial impact. In the first half of 2023, individuals aged 20-29 reported that social media served as the primary method of contact in over 38% of fraud cases, while for those aged 18-19, the figure soared to 47%.
Social media gives scammers an “edge,” the agency noted, as fraudsters can craft fake personas or compromise existing profiles, tailor their approach based on the information shared on social media, and use advertisements to target individuals according to personal details such as age, interests, or previous purchases — all at minimal cost and with the ability to reach a wide range of users.
The most common instance of fraud on social media in the first half of 2023 was users attempting to purchase a product on a platform, accounting for 44% of all reported social media fraud. Most of these incidents involved undelivered products, with clothing and electronics ranking highest on the list.
Counterfeit investment opportunities were the second most prevalent form of social media scams at 20%. However, it cost victims the most monetarily in the first six months of 2023, accounting for 53% of total losses from all social media scams, while shopping-related scams accounted for a mere 8%.
With social media scams running rampant, the FTC is offering tips on how to stay vigilant:
- Restrict the visibility of personal information on social media by adjusting privacy settings.
- Be wary of messages from friends or acquaintances requesting money or offering a questionable opportunity, and verify their identity by contacting them off of the platform.
- If someone on social media hastily pushes for a friendship or romantic connection, exercise caution, as romance scams are the third most common form of social media fraud.
- Before making a purchase, conduct an online search of the company’s name along with keywords like “scam” or “complaint” to assess its credibility.