Cryptocurrency Scams Using Social Media – The United States Federal Trade Commission (FTC) has issued a warning against cryptocurrency investment schemes that use social media.
“In investment scams, social media is a tool for scammers,” according to the FTC, “especially those involving phony cryptocurrency investments — an area that has seen a remarkable surge in reports.”
The Federal Trade Commission has issued a warning about cryptocurrency scams that use social media.
Last week, the Federal Trade Commission (FTC) issued a Consumer Protection Data Spotlight, alerting the public about social media-based scams, including crypto investment schemes.
The Federal Trade Commission (FTC) is a federal agency whose primary objective is to enforce antitrust laws and safeguard consumers.
In 2021, the FTC’s program analyst Emma Fletcher said, “more than 95,000 people reported nearly $770 million in damages due to fraud launched on social media sites.” Those losses account for nearly a quarter of all reported fraud losses in 2021, representing an incredible eighteenfold increase over reported losses in 2017.
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She added:
“Reports show that social media is a tool used by scammers in investment scams, notably those involving fraudulent cryptocurrency investments, which has witnessed a huge increase in reports.”
According to the FTC analyst, more than half of respondents who reported investment scam losses in 2021 indicated the scam started on social media.
Scammers utilize social media sites to offer fraudulent investment possibilities, according to FTC reports, and even to engage with people directly as claimed friends to convince them to invest. People contribute money, usually in the form of cryptocurrency, with the expectation of large returns, but they end up with nothing.
Following that, the FTC offered some tips on how to keep safe on social media. One option is to limit who can view your social media posts and information. You can also opt-out of targeted advertising, according to the agency. Another tip is to look up the company you’re about to buy from on the internet to see if its name has been linked to a scam or a complaint.
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Furthermore, “Call a friend if you get a communication from them concerning an opportunity or an urgent need for money.” Their account may have been hacked if they ask you to pay using cryptocurrencies, a gift card, or a wire transfer. The FTC noted, “This is how scammers beg you to pay.”
Scammers made a record $14 billion in cryptocurrencies in 2021, according to blockchain analytics firm Chainalysis, owing to the advent of decentralized finance (defi) platforms.
According to the organization, losses from crypto-related crime increased by 79 percent year over year, owing to an increase in theft and scams.