$1 billion lost in crypto scams by users of the social media platform Meta. Instagram, Facebook and WhatsApp were listed as top user scammed platforms, Telegram was also named. The number of scams on these platforms has continued to increase exponentially since 2018.
In 2021, half of all digital asset scams originated on social media platforms, costing investors over $400 million. Meta Platforms Inc. (NASDAQ: META) took the biggest blame, with Facebook, Instagram, and WhatsApp being rife with scammers. Now, a group of U.S. senators has put CEO Mark Zuckerberg to task, asking him to explain how he’s fighting these scammers.
The six senators recently wrote a letter to Zuckerberg requesting information on Meta’s efforts to combat these scams. They included Senator Elizabeth Warren (D-Mass.), an outspoken digital asset critic who a month ago urged the Office of the Comptroller of the Currency (OCC) to rescind a letter that allowed banks to engage in digital assets.
In their letter, they cited a report by the Federal Trade Commission that indicated that 49% of digital asset scams between January 1, 2021, and March 31, 2022, originated on social media platforms. This rose from 37% in 2020 to 18% the year prior. These scammers stole $417 million from unsuspecting investors, with investment scams accounting for $273 million, ahead of romance scams at $69 million.
While all social media platforms have scammers, Meta-owned sites are “particularly popular hunting grounds for scammers,” the senators claimed. Instagram accounted for the highest share of scammers in the social media world at 32%, with Facebook closely trailing at 26%. WhatsApp’s share stood at 9%.
Zuckerberg had proven he was aware of the prevalence of scammers when he banned digital asset ads in 2018, the Senators noted. However, he would later roll back the ban, admitting ads under stricter guidelines.
Among the things the Senators are interested in is Meta’s current policies for proactively spotting and removing scammers from its platforms. They also want to know how Meta verifies that digital asset ads are not scams. Aside from dealing with scammers, the Senators are interested in Meta’s proactive measures to protect users through education and warnings.
The lawmakers also asked if Meta assists the digital asset scam victims and if the social media giant collaborates with law enforcement to curb fraud.
Meta is no stranger to legal action over digital asset scams on its platforms. It has been sued several times for allowing scammers to easily set up and target its users. Some lawsuits even accuse platforms like YouTube of benefitting from these scammers.
As CoinGeek reported in March, Australia’s Competition and Consumer Commission (ACCC) sued Meta over investment scams that used celebrity images to lure investors. The regulator claimed that Facebook, in particular, assisted the scammers in targeting their audience and earned revenue from their scam ads.