FTC Issues Social Media Scam Warning as Losses Climb to a Record $2.1 Billion
According to the latest data, the most lucrative schemes identified involve fraudulent investment opportunities, particularly those promising high returns, such as on cryptocurrencies. Scammers have been using professional-looking advertisements and hijacked accounts to create a false sense of legitimacy, then luring victims into fake investment platforms that allow them to see phantom gains on a screen while their actual funds are diverted into untraceable wallets. These investment scams alone accounted for nearly $1.1 billion in losses, likely leaving thousands of individuals with emptied retirement accounts and significant debt.
Elsewhere, the report warns against romance scams. In these scenarios, bad actors spend weeks or even months building emotional rapport with victims through direct social media platforms. Once trust is established, a manufactured crisis, such as a legal emergency, medical bill, or travel complication, becomes the pretext for a request for money. Other times, victims are lured into investing into—yes, you guessed it—a fake investment opportunity.
Retail-related fraud also continues to plague social feeds, driven by the rise in social commerce. Consumers frequently report ordering products seen in targeted advertisements only to receive cheap knockoffs or nothing at all. In many cases, scammers create ghost storefronts that disappear within days of a major ad campaign, making it nearly impossible for consumers or banks to recover the lost funds. These operations are increasingly leveraging artificial intelligence to generate convincing product images and testimonials, which, for the average consumer, becomes a challenge to tell what's legitimate and what's not.
The demographic data reveals a surprising trend: all age groups are reporting fraud at higher rates than age groups 80 and above. Older folks were found to more likely be scammed by phone calls versus social media, which still accounted for a mind-blowing $1.1 billion in losses.
To help keep yourself safe, the FTC warns to increase the privacy settings on your social media accounts to limit what scammers can work it. Likewise, educate yourself on any online companies you might buy from, regardless of whether they're real or fake—Googling helps a great deal here.
