Social media scammers net $117M targeting shoppers, romance seekers: FTC
Most scams targeted people through fake ads for products that, when purchased, were never delivered
Ramsey Solutions financial expert Chris Hogan on scammers taking advantage of the student debt crisis and a new study revealing that 68 percent of credit card users are focusing on maximizing credit card rewards rather than paying off their debt.
The Federal Trade Commission said scammers amassed $117 million through fake Facebook, Instagram and other social media posts hawking products and promising love during the COVID-19 pandemic.
A majority of the scams that took place in the first six months of the year targeted people through fake advertisements for products that, when purchased, were never delivered.
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The regulatory agency also reported an uptick in romance scams since the pandemic began, many of which started with a private message or friend request.
Nearly one in four complaints to the FTC mentioned a social media hook and 94% of the reports specifically mentioned Facebook or Instagram.
Other schemes relied on social media friends who may have been hacked or scammed themselves; many offered grant money and other giveaways to help with COVID-19 relief. Scammers were probably after money or personal information, the FTC said.
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Reports of people losing money to scams that started on social media more than tripled in the past year, with a sharp increase in the second quarter of 2020, the agency said.
In addition, reports of pyramid schemes climbed fivefold, including blessing circles and other gifting schemes where recruiters made extravagant claims about likely earnings, which ultimately wiped out investments by participants without any returns.
In August, the FTC warned consumers of another scam, this one circulating on WhatsApp and Facebook offering money through grants, coupons for food support, or other giveaways that seemed to come from large companies like Pepsi, Walmart, Whole Foods, and Target but were all fake.