Victims reported $2.7 billion in social media scam losses since 2021: FTC

Social media scams have cost victims who reported losses to the Federal Trade Commission $2.7 billion since 2021 — likely a “small fraction” of the total money stolen via platforms like Facebook and Instagram.

According to the FTC, one in four people who reported losses to the agency’s Consumer Sentinel Network since 2021 said the fraud started on a social media platform. Victims of such scams skewed young, with social media being the point of contact for scammers in 38% of cases involving victims ages 20 to 29, and 47% for 18- and 19-year-olds.

In the first half of this year, shopping scams made up the biggest chunk of fraud cases involving social media, with 44% of reports entailing fraudulent sales. “Most of these reports are about undelivered goods, with no-show clothing and electronics topping the list,” the FTC wrote, adding that they typically begin with advertisements on Facebook or Instagram.

Although they are common, shopping scams on average only result in a loss of about $100 per incident. The most damaging schemes — investment scams — average about $3,000 in losses per incident, and typically involve luring victims to third-party websites or apps after touting money-making opportunities on social media.

“They make promises of huge returns, and even make it look like an ‘investment’ is growing,” the FTC said. “But if people invest, and reports say it’s usually in cryptocurrency, they end up empty handed.”

Romance scams — when someone on social media fraudulently courts and butters up a target with the goal of getting access to their money — averages about $1,700 in losses per incident, according to the FTC.

The FTC recommends people use caution on social media platforms, first by limiting permissions to restrict who is allowed to see their profiles. They should also be skeptical of messages, even from friends’ accounts, asking for money, and wary of people on social media who appear to be rushing them into a friendship or romance. The agency also recommends researching an online brand or store before making any purchases from them.