Huge increase in online fraud, with social media ads a big culprit

For scammers, there’s a lot to like about social media. It’s a low-cost way to reach billions of people from anywhere in the world. It’s easy to manufacture a fake persona, or scammers can hack into an existing profile to get ‘friends’ to con. 

Scammers use tools available to online advertisers

There’s also the ability to fine-tune their approach by studying the personal details people share on social media.

“In fact, scammers could easily use the tools available to advertisers on social media platforms to systematically target people with bogus ads based on personal details such as their age, interests, or past purchases,” the FTC warns.

Reports to the organisation show scammers use social media platforms to promote bogus investment opportunities, and even to connect with people directly – as supposed ‘friends’ – to encourage them to invest. People send money, often cryptocurrency, on promises of huge returns, but end up empty handed.[7]

After investment scams, FTC data point to romance scams as the second most profitable fraud on social media. Losses to romance scams have climbed to record highs in recent years. More than a third of people who said they lost money to an online romance scam in 2021 said it began on Facebook or Instagram. These scams often start with a seemingly innocent friend request from a stranger, followed by sweet talk, and then, inevitably, a request for money.

“Together, investment scams, romance scams and online shopping fraud accounted for over 70% of reported losses to social media scams in 2021. But there are many other frauds on social media too, and new ones popping up all the time,” the FTC stated.