Instagram, Facebook top list of social media used by investment scammers
Figures released by the City of London Police show criminals continue to use popular social media apps to advertise investment scams and contact potential victims.
Over £63 million was lost in the UK by victims of investment fraud who referred to a social media platform in their report to Action Fraud, the national reporting centre for fraud and cyber crime. Some victims mentioned being approached directly by an investment fraudster, whilst others said they were attracted to a fake investment through adverts.
During a 12 month period, 5,039 reports of investment fraud made reference to a social media platform, with 44.7% of reports stating the fake commodity they had been scammed into investing in was a type of cryptocurrency.
In the reports, Instagram was the most referenced platform (35.2%), followed by Facebook (18.4%).
The City of London Police says the use of social media by criminals is helping to buck the trend for typical investment fraud victims, with under 30s being most affected. Specifically, 27.5% of all investment fraud victims who mentioned social media in their report were aged 19-25, and 61% were men.
By contrast, when looking at investment fraud reports where social media did not play a factor in the scam, the average age of victims was over 50.
Criminals are also using social media influencers to carry out their scams, exploiting the brand image and reputation of well-known individuals without their knowledge and advertising bogus celebrity endorsements.
Between April 2020 and March 2021, Action Fraud received over 500 investment fraud reports which made reference to a bogus celebrity endorsement, with losses exceeding £10 million.
Another common trend seen by crime analysts at the City of London Police’s National Fraud Intelligence Bureau, relates to cloned company investment fraud, where criminals will copy the branding of legitimate investment companies to trick people into handing over money.
Some reports even mentioned seeing LinkedIn profiles for the broker who had approached them, which helped persuade them that the offer was legitimate.
A recent report identified that 8% of all cloned company fraud victims had initiated contact with the suspect following a direct approach, or after seeing an advert, on a social media platform.