The Federal Trade Commission (FTC) reports a large increase in the number of Americans falling victim to scams originating on social media. The FTC said the spike began almost as soon as the coronavirus (COVID-19) pandemic hit.
The agency says the number of complaints about scams that started on social media more than tripled in the last 12 months. People reported losing more than $117 million to these types of scams in just the first six months of 2020 compared to $134 million for all of 2019, according to the FTC’s latest Consumer Protection Data Spotlight.
Online shopping topped the list of complaints from consumers who reported a scam to the FTC that originated on social media. During those first few weeks in the spring when nearly everyone was sheltering in place, scammers ran social media ads for home delivery of all sorts of household products that never arrived.
An overwhelming majority of victims -- 94 percent -- said the scams were delivered on either Facebook or Instagram. Those two platforms were also favorite vehicles for romance scams.
Bogus income opportunities
Other common scams revolved around economic relief or income opportunities. The FTC says people who suddenly lost their jobs were the most likely to be victimized.
“As people seek more ways to earn money, reports about multi-level marketing (MLM) companies and pyramid schemes – including blessing circles and other gifting schemes – on social media have increased,” the FTC said in its latest Data Spotlight. “The numbers were up a staggering fivefold in the second quarter of 2020.”
Social media proved to be a powerful tool for scammers running these types of schemes. The FTC said the pitch was often distributed through hacked Facebook accounts so it would appear a friend was recommending the pyramid scheme.
In a few cases, the FTC said some people who bit on the scammer’s pitch distributed it to their friends, legitimately believing it to be a good opportunity in economically uncertain times.
The FTC says the use of social networks to target victims gives a scammer added power. It says scammers can obtain trust by breaking into one of these networks of people who know one another.
Tips for avoiding scams
To protect yourself from scams launched from social media platforms, the FTC offers this advice:
Check out the company before you buy anything based on a social media ad. Type its name in a search engine with words like or “scam” or “complaint.”
Never send money to a love interest you have not met in person.
If you get a message from a friend about a way to get some financial relief, call them. Did they forward it to you? If not, tell them their account may have been hacked. If so, check it out before you act.
Before paying to enroll in an income “opportunity,” check out ftc.gov/mlm
Don’t make it easy for scammers to target you – check your social media privacy settings to limit what you share publicly.