Social media scammers made off with a crazy amount of cash in 2021.
According to a Jan. 25 report put out by the Federal Trade Commission (FTC), over 95,000 people reported $770 million had been lost to social media fraud in 2021. What’s more shocking is the losses only accounted for 25% of all reported fraud in 2021, showcasing “a stunning eighteenfold increase” in fraud compared to 2017, the report read.
While fraud claims were up for every age range in 2021, people aged 18 to 39 were more than twice as likely to lose money to scams compared to older adults in 2021.
One of the more successful kinds of scams was shopping scams involving items that never arrived. 9 out of 10 victims said they had been targeted for these scams on either Facebook or Instagram, which the FTC report said accounted for almost half of the losses reported.
However, the report noted that online investment scams were the biggest culprit in social media fraud, and had ballooned in 2021, accounting for $285 million of 2021 losses. Investment scams often involved both standard investments in stocks, bonds, and crypto, but also in art, stock options, and even just investment advice.
64 percent of victims paid their scammers in cryptocurrency, and while investors older than 50 were less likely to fall for these crypto scams, they ended up coughing up more money than younger adults when they did fall victim. Their median loss was around $3,250. Altogether, investment scams accounted for a whopping 60% of losses.
The FTC’s report also highlighted romance scams as being the second most lucrative method of getting money from people in 2021. Many of these scams are initiated on social media. “More than a third of people who said they lost money to an online romance scam in 2021 said it began on Facebook or Instagram,” the report reads. “These scams often start with a seemingly innocent friend request from a stranger, followed by sweet talk, and then, inevitably, a request for money.”
Meta, the parent company of Facebook, has not responded to the report.