Federal Trade Commission Issues Public Warning Over Crypto Scams Run on Social Media

The US Federal Trade Commission (FTC) released its “Consumer Protection Data Spotlight” last week, cautioning the public from falling for crypto investment scams perpetrated via social media.

FTC program analyst Emma Fletcher recently wrote: “More than 95,000 people reported about $770 million in losses to fraud initiated on social media platforms in 2021, adding that “those losses account for about 25% of all reported losses to fraud in 2021 and represent a stunning eighteenfold increase over 2017 reported losses. The analyst explained:

“Reports make clear that social media is a tool for scammers in investment scams, particularly those involving bogus cryptocurrency investments — an area that has seen a massive surge in reports.”

She also explained: “more than half of people who reported losses to investment scams in 2021 said the scam started on social media.” Fletcher also narrated: “Reports to the FTC show scammers use social media platforms to promote bogus investment opportunities, and even to connect with people directly as supposed friends to encourage them to invest. People send money, often [a] cryptocurrency, on promises of huge returns, but end up empty-handed.”

Federal Trade Commission Offers Tips on How to Avoid These Scams

The Commission then gave some tips on how to avoid these scams on social media, noting that the first tip is to limit who sees your posts and notifications on social media. The agency also advised opting out of targeted advertising. Thirdly, FTC advised the public to run a quick background check on the company they intend to do business with to ascertain if the company has been associated with any scams or complaints.

Additionally, the Commission advised: “If you get a message from a friend about an opportunity or an urgent need for money, call them. Their account may have been hacked – especially if they ask you to pay by cryptocurrency, gift card, or wire transfer. That’s how scammers ask you to pay.”

Earlier in January, Learn2Trade published a warning from the FTC regarding cryptocurrency ATM scams.