The Federal Trade Commission says that scams initiated on social media cost people a collective $770 million in 2021—and that’s just among those who reported their losses.
That $770 million represents “about one fourth of all reported fraud losses for the year and an 18-fold increase from 2017,” according to the FTC, which also says the number of scam victims who say they were first contacted via social media had more than doubled since 2020.
“The largest number of reports came from people who lost money to online shopping scams,” the FTC says. “Most of the reports about online shopping scams involved someone who ordered a product they saw marketed on social media that never arrived.”
These scams aren’t limited to niche platforms: The FTC says that “consumers who listed the social media platform where the undelivered products were marketed most often named Facebook or Instagram.” (Which makes sense, given that both have a billion-plus users.)
Online shopping scams might have received the most reports, but they weren’t the most costly to consumers, according to the FTC. Instead the commission says the leading scam categories (scamegories?) in terms of financial cost are investment scams and romance scams.
“Reports to the FTC show scammers use social media platforms to promote bogus investment opportunities,” the FTC says in the latest Consumer Protection Data Spotlight, “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.”
The commission says that scams “involving bogus cryptocurrency investments” saw “a massive surge in reports” in 2021. Romance scams—through which scammers pretend to befriend or form relationships with their victims—are popular on social media as well.
The FTC says people can defend themselves against social media scams by carefully managing their privacy settings, confirming any strange requests to send money, and searching for a company’s name plus “scam” or “complaint” before purchasing one of their products.
