Many people’s lives are permeated by social media; we use it to remain in touch with old friends, meet new ones, shop, and have a good time. However, according to reports filed with the Federal Trade Commission, social media is becoming a more popular place for scammers to deceive us. Moreover, one in every four persons who reported losing money to fraud in 2021 claimed the deception began with an advertisement, a post, or communication on social media.
This might come across as shocking, but social media scams are on the rise. According to a new report by the Federal Trade Commission (FTC), an increasing number of consumers in the United States are being scammed on social media. The FTC found that consumers lost $770 million to social media scams in 2021, accounting for approximately one-fourth of all fraud losses for the year. According to the Federal Trade Commission, social media fraud had surged 18 times since 2017, when $42 million in social media fraud was reported, as new sorts of frauds using cryptocurrencies and online commerce have become more prevalent. This has also resulted in a significant increase in the number of younger consumers being scammed, with those ages 18 to 39 reporting fraud losses at a rate that is 2.4 times greater than adults aged 40 and over.
The Various Nature of Social Media Scams
Social media scams are a very common type of internet/online scam. Using the internet is a sort of cybercrime fraud or deception that involves the concealment of information or the provision of erroneous information with the intent of defrauding victims of their money, property, or inheritance. Social media fraud is not considered to be a unique, distinct crime but rather encompasses a wide range of illegal and illicit activities that are carried out in cyberspace. In contrast to stealing, it is distinguished by the fact that the victim freely and consciously provides the offender with the necessary information, money, or property in this instance. It is further distinguished by the fact that it involves offenders who are separated in terms of both time and space.
It was estimated that around 300,000 complaints were sent to the Internet Crime Complaint Center (IC3) in 2017, according to the FBI’s 2017 Internet Crime Report. In 2017, victims of internet fraud suffered a total loss of nearly $1.4 billion. CSIS and McAfee published a study in which they found that cybercrime costs the global economy up to $600 billion each year, or 0.8 percent of the entire global gross domestic product (GDP). Despite the fact that social media fraud is largely or entirely dependent on the use of the internet, it can occur even if it is only partially dependent on its usage of the internet.
Scammers have undoubtedly discovered that social media is one of the most profitable platforms through which to perpetrate fraud. Moreover, 95,000 fraud victims reported that they were approached for the first time on social media, more than double the number reported in 2020 and up 19 times from 2017. More than one in every four people who reported losing money to fraud to the Federal Trade Commission (FTC) last year stated that they were encouraged to report the fraud after seeing a post, message, or advertisement on social media. Social media scams accounted for 26 percent of the losses attributed to fraud in 2021 ($770 million), excluding reports that did not specify a contact method. Websites and apps accounted for 19 percent ($554 million) of the losses, and phone calls accounted for 18 percent ($546 million), according to the FBI. In contrast to social media fraud, phone fraud had the largest median individual losses, at $1,110, compared to $468 for social media fraud.
According to the research, Facebook and Instagram were the platforms where the majority of these social media scams took place. Among those who have fallen victim to online romance scams, more than a third of victims indicated that the scammer reached out to them using social media platforms such as Facebook or Instagram. In particular, Facebook was responsible for 23 percent of romance frauds, and Instagram was responsible for 13 percent. According to the research, these frauds would begin with an apparently benign friend request, which would be followed by sweet talk, and then a request for money.
More than half (54 percent) of investment scams in 2021 began on social media platforms when scammers would promote fictitious investment possibilities or communicate with victims directly in order to convince them to invest. Instagram was the most popular social media platform among fraudsters in this country, accounting for 36 percent of investment scams, followed by Facebook at 28 percent, and then messaging applications WhatsApp and Telegram, which accounted for 9 percent and 7 percent of investment scams, respectively.
A Rise in Social Media Scams – Statistics and Examples
More personal information about themselves (such as birthday, email address, hometown, and relationship status) is disclosed in social networking profiles than in other forms of online communication. It is possible for fraudsters to utilize this personally identifiable information to steal users’ identities, and putting it on social media makes it much easier for fraudsters to gain control of the information. The issue of authenticity in internet reviews has been around for a long time and has remained stubborn. The genuine identities of thousands of Amazon’s previously anonymous U.S. book reviewers were mistakenly revealed in one well-known instance back in 2004 when the company’s Canadian website made an error. One insight gained as a result of the error was that many authors were adopting fictitious names in order to give favorable evaluations to their own publications. Also, 72 percent of respondents say positive reviews encourage them to place greater trust in a company, and 88 percent say they trust online reviews as much as they do personal recommendations under “the right circumstances.”
While scammers are increasingly making use of the power of social media to conduct criminal activities, intelligent risk managers and their insurance firms are discovering ways to use social media information as a tool to battle insurance fraud and other forms of financial crime. For example, an injured worker who was out of work as a result of a worker’s compensation claim may not resist joining a local semi-professional sports team and participating in a contact sport. Investigators established that the worker was listed on the club’s roster and was doing admirably through social media and internet searches, which they shared with the team.
According to the local authorities, a woman from the United Kingdom was victimized by a “romantic fraud” on the internet. The woman in her 50s is said to have lost her inheritance, which was worth £320,000 and had been left to her by her parents, who later abandoned her as a result of the loss. When the victim’s spouse passed away in 2019, the perpetrator, who pretended to be Tim, met her on a dating service where they became acquainted. The money was stolen in two stages: first, he took £68,000 in the name of customs duties, and then he urged her to pay £200,000 directly to his translator in order to secure his contractors and keep his equipment, bringing the total amount stolen to £320,000.
Types of Social Media Scams Our Clients Encounter
Many of us have come to rely on social media platforms such as Facebook, Instagram, and Twitter to remain connected, keep up with the news, and even make purchases. However, as their popularity grows, so does the risk of being a victim of fraud. These types of frauds are becoming increasingly complex, frequently employing brand logos and fictitious terms and conditions to make them appear legitimate. This article discusses the most frequent types of social media fraud, as well as how to protect yourself online from these schemes.
Free App Downloads
Frequently, these apps will request that you provide personal information. It is possible that a software that appears to be legitimate can really download malware onto your smartphone. Before downloading any new apps, ask yourself if you can trust the source, conduct your own research, and avoid using third-party app stores – instead, use the one provided by your phone service provider.
It goes without saying that you should be cautious about who you communicate with on social networking platforms. Despite the fact that someone adding you as a friend and wanting money appears to be something that only happens on American television shows, it is actually rather regular. The fraudster may go so far as to impersonate one of your friends, or they may email you a phishing link that directs you to a malicious web page on your computer.
Be wary about clicking on abbreviated URLs that do not provide the entire URL of the webpage you are visiting. They are extremely frequent on Twitter. While they may legitimately take you to the correct website, there is always the possibility that they will divert you to a malicious website that will install malware. Take caution when clicking on links, check to see if the post is typical of the account that published it, and make sure you have real-time protection from spyware and viruses.
Online quizzes that promise to reveal your personality type, identify which celebrity you look like, or award you with a prize that seems too good to be true are actually dangerous. They almost always include terms and conditions that allow the information you provide to be sold to third parties after you submit it. It also implies that the app developer will be able to gather a great deal of information about you from your profile, friends, and Internet Protocol address. Stay cautious and do not participate in any brief quizzes that are advertised on social media sites such as Facebook and Twitter.
Events Leading Up to Adam Muller Being Scammed
In an Instagram direct message, Adam was encouraged to invest in the athletic business by highlighting the advantages of gambling software used in the process. Numerous statistics and numbers demonstrating significant returns were shown, together with photographs of people enjoying the high life at beautiful sporting events. A computer program was developed in order to anticipate victories and losses in specific athletic events so that investors may place regular bets based on a “knowledge of the industry,” according to the message.
All that was required of Adam was that he purchase the software, make a $20 000 investment, and follow the program’s instructions. Adam said that the original trading account cost him $20,000 but that he only made about $2000, far short of the promised returns on his investment in the stock market. After calling the hotline, he was offered the opportunity to upgrade to a better program for an additional $25,000. He declined. He stated that the first initiative had failed to generate even a fraction of the promised $20 000, so why would he consider investing another $25 000 in the second scheme?
The con artist on the other end of the line said that Adam could earn up to $5000 per month with the new service. The upgrade was finally accepted after several days of nagging from his friends and family. Over time, he continued to lose money in his betting account, and he was forced to replenish it in order for them to continue betting. Adam’s phone calls were no longer returned after a slew of more calls to the assistance line. Over the course of several months, Adam recognized that the scammers would simply keep demanding more money and that the promised rewards would never materialize. Later, he discovered that the fraudster had actually only recently arrived in the United States and was in desperate need of money to cover their living expenses for the time being. They had considered Adam to be the ideal target since he would constantly update his Instagram page with photographs of expensive luxury cars and himself enjoying trips to exotic locations such as the Maldives while staying in high-end hotels.
If you have been scammed through online, then contact us to get your money back!
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Adam heard about us through his colleagues, and as soon as he contacted us, we knew just what to do. With our highly talented team of highly trained lawyers, cyber investigators, and case filers, we worked together to track down scammers’ digital footprints. We assisted Adam in putting together and fighting for his recovery case. With our collaborative efforts, we led Adam through this seamless process and helped him recover his lost funds and proud to report Adam as an addition to our long list of satisfied clients. So, what are you waiting for? Contact us immediately and get your fund’s recovery process started today!