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The FTC says social media was a ‘gold mine’ for fraudsters in 2021, leading to $ 770 million in losses

Image for article titled FTC says social media was a 'gold mine' for scammers in 2021, leading to $ 770 million in losses

Photo: Manan Vatsyayana / AFP (Getty Images)

Social media has become an increasingly popular tool among scammers in recent years, which is bad news for those of us who visit the platforms. ONE new report from the Federal Trade Commission, published this week, called social media a "gold mine for scammers" reminding us all of a guiding principle we should live by: Trust no one online.

According to the FTC, social media fraud has increased at an alarming rate over the past five years, accounting for approx. $ 770 million in reported losses in 2021, a jaw drop eighteen times increase from 2017, where $ 42 million in reported losses. The agency received more than 95,000 reports of scams launched on social media last year across a variety of categories, including investment scams, romance scams and online shopping scams.

Investment scams (37%) and romance scams (24%) were the most profitable for scammers among those reported. (Any scam is an evil deed, of course, but those who use romance to cheat are really heartless).

Image for article titled FTC says social media was a 'gold mine' for scammers in 2021, leading to $ 770 million in losses

In investment fraud, individuals reach out to users on social media with promising fake investment opportunities large returns, sometimes mimicking the victim's friends to get them to send money. Fraud involving cryptocurrency has increased, which is unfortunately no surprise given its boom in popularity.

Then there is the romance scam, a scam category that is also record high and which consists of exactly what their name suggests.

"More than a third of people who said they lost money on an online romantic scam in 2021 said it started on Facebook or Instagram." said the FTC. "These scams often start with a seemingly innocent friend request from a stranger, followed by sweet talk and then inevitably a request for money."

Online shopping was another notable scam category in the agency's report. Although it is not as profitable as the other types of scams mentioned above, it was the fraud that most people reported to the FTC, accounting for 45% of the loss reports. Victims of these scams bought something on social media - Facebook and Instagram were the most cited platforms - but never received their purchase.

Overall, the FTCs data shows that social media earned scammers more money in 2021 than any other method of reaching people.

There is a lot that scammers like about social media, the agency listed. First, it is a cheap way to reach billions of people worldwide. It's also easy to lie about who they are and their intentions, and they may even hack into the profiles on your social media and try to get money out of you that way. We also share way too much about ourselves online, allowing scammers to study users' personal information to better target their plan.

"Scammers who try to get your money are always looking for new ways to reach people. And they will use everything they know about you to target their pitch," said Rosario Méndez, part of the agency's department for consumer and vocational education, in a blog posts.

In addition to being vigilant about the content and people you interact with on social media, there are some other great practices you can apply. Some recommendations from the FTC includes restricting who can see your posts and information on social media, opting out of targeting advertising if possible, and calling friends who ask you for money on social media to confirm that it really is them.

If you fall victim to social media scams, do not panic. There are ways for you to possibly get your money back. To be safe, however, avoid investing, romance and shopping at companies you have never heard of before.

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