U.S. Senators have called on Meta CEO Mark Zuckerberg to detail policies his company is using to address the rising cases of cryptocurrency scams on Facebook and Instagram, The Washington Post reported on Sept. 9.
The lawmakers made the call as a recent report by the Federal Trade Commission (FTC) reveals that cryptocurrency scams have increased significantly across social media platforms owned by Meta.
The FTC published a report in June, revealing that about 50% of the people who lost money via a cryptocurrency scam since 2021 claimed it originated on a social media platform. Meta’s Instagram facilitated 32% of the reported scams, while Facebook and WhatsApp were cited 26% and 9% of the time, respectively.
Senator Robert Menendez told The Washington Post:
“Based on recent reports of scams on other media platforms and apps, we are concerned that Meta provides a breeding ground for cryptocurrencycurrency fraud that causes significant harm to consumers.”
The lawmakers have called on Meta CEO Mark Zuckerberg to submit a detailed report on how the company is compacting cryptocurrency scams and the steps it takes to assist victims of fraud. Zuckerberg is expected to respond to the request by Oct. 24, 2022.
Crypto scams on Social media
Crypto has become a common means of payment for users on social media. Unfortunately, bad actors have scammed unsuspecting users of hundreds of millions of dollars.
According to the FTC report, over 95,000 users lost about $770 million to social media-engineered cryptocurrency scams. Over 70% of the reported scams were categorized as either investment, romance, or online shopping scams.
A 2021 study by BBC revealed that about 10,500 victims lost more than $18 million to give away scams in the first three months of 2021. Most of the giveaway scams are perpetrated by impersonating influential personalities like Elon Musk.
A victim reportedly lost over $550,000 in February 2021 after sending 10 BTC to an Elon Musk giveaway scam.
Observing the rising trend of cryptocurrency scams on social media platforms, FatManTerra recently pulled a fake investment prank that saw unsuspecting users sending him over $100,000.
FatManTerra used the incident to educate the community against looking for a free launch in cryptocurrency and refunded those who were hoodwinked by it.
I have refunded every person who sent money in full.
There was no investment.
Risk-free high yields don’t exist.
Free lunches don’t exist.
Influencers have started scamming on Twitter, and before more of them crop up, I want them to know:
We will work to take you down.
— FatMan (@FatManTerra) September 5, 2022