Social Media Use and Fraud

A recent report by the Federal Trade Commission (FTC, January 25, 2022) highlights the shift to social media as the platform of choice for con artists. Per the FTC, 1 in 4 scams start on social media, and it is the most profitable venue for reaching victims than any other format.

These scams may start with an ad, a post, or a message using a number of platforms. Losses initiated on social media are estimated to be in the range of $770 million for 2021 alone. The scams range from romance scams to investment scams with a massive increase in cryptocurrency scams. As a result of this shift, younger adults aged 18-39 were more than twice as likely as older adults to report losing money to these scams in 2021.

Younger adults and employment scams

Younger adults have different vulnerabilities than seniors. For example, new workers who need jobs and have limited professional experience are more likely to fall prey to employment scams.

These scams often start with either a bogus job posting on legitimate job boards (like Indeed or ZipRecruiter) or are initiated by third parties that contact job seekers indicating they had seen their resume on Indeed or a similar platform. In a typical example, the scammer suggests using a messaging tool such as Telegram or WhatsApp and conducts most or all of the business using text messaging.

I was contacted by a recent college graduate who was willing to speak to me about their experience with this type of scam. The individual graduated last May and was still looking for work in the area of a remote IT help desk or similar position. They were contacted by a recruitment manager who indicated they had seen their resume and indicated falsely that they were from a well-known supplement company. The position was a remote IT-type job and the rate was a tad higher than other entry-level jobs, but not out of the range.

The manager immediately indicated that the interview and training would take place on Telegram, and asked the applicant to download the app to proceed. Telegram is an instant messaging service similar to WhatsApp or Facebook messaging. It has been implicated in cryptocurrency scams and is also used by those seeking secrecy as individuals can communicate without exchanging phone numbers.

Besides being on Telegram, the interview questions appeared routine and professional related to work experience and logistics. Once “hired,” they were asked to give a social security number and other personal information. The big red flag, however, was the requirement that they deposit a $1400 check in their bank account to be used to purchase expensive equipment. At this point in time, the individual contacted me and I advised them to contact their banking institution to cancel the check and initiate a fraud investigation. I also recommended initiating a service to monitor credit reports and threats of identity theft.

If allowed to proceed, the scammer may ask the victim to “buy” expensive software with their own funds, and in the meantime, the initial check bounces. Or sometimes, they ask the individual to purchase crypto and send it to other accounts as part of the job and the applicant becomes unwittingly involved in money laundering. Or both—they become both a victim and have their bank accounts used by the scammers for other purposes. Usually, the banking institution will catch the fraudulent transactions and freeze the account or block online banking after a few suspicious transactions.

Law enforcement recommends contacting your bank and credit card companies, contacting credit monitoring companies, and contacting the national consumer credit line in the US (1-888-567-8688) if you suspect you have been the victim of an employment scam.

Scam victims may also need support. Already discouraged from a difficult job search, younger consumers may become less confident and more anxious regarding their prospects. Like any crime victim, they need support and to be assured that these incidents could literally happen to anyone.