UK consumers lost £75mn to financial scams on social media in one year alone, with a total of 3,597 reports to the police about investment fraud.
According to a Freedom of Information request submitted to the National Fraud Intelligence Bureau by comparison site Good Money Guide, Instagram was mentioned in more than half of cases, followed by Facebook with 1,193 reports.
Total losses were greater on Facebook, however, with £33mn lost to frauds and scams originating on the platform.
The FOI asked about scam reports on social media platforms that mention ‘trading’, ‘investing’, ‘stocks’, ‘crypto’, or ‘broker’ in the past five years.
Richard Berry, founder of Good Money Guide, said: “It’s easy to stumble across social media posts offering an investment opportunity that seems too good to be true, and in 99 per cent of cases, that’s exactly what it is.
“It’s staggering to think that in just one year UK consumers have lost £75mn to financial scams and fraudsters on social media.
“It’s time that the platforms took a long hard look at the material they’re allowing online, as too often they are being used as a hunting ground by scammers preying on the unwary.”
Despite police only receiving 50 reports of financial scams on TikTok, the average loss per victim was the highest at £138,472. This was almost double the next highest amount – £77,428 on LinkedIn.
Police reports and financial losses in 2022
Platform | Losses | Reports | Average loss per claim |
TikTok | £6,923,619 | 50 | £138,472 |
£8,439,632 | 109 | £77,428 | |
YouTube | £10,048,855 | 231 | £43,502 |
£32,608,158 | 1,193 | £27,333 | |
£3,647,635 | 157 | £23,233 | |
£13,047,334 | 1,857 | £7,026 | |
Total | £74,715,234 | 3,597 | £20,772 |
Source: Action Fraud / Good Money Guide
Total losses from scams on social media were six times higher than they had been three years previously, rising from £13mn in 2019 to £75mn in 2022.
Berry said: “The criminals often go to great lengths to make their scams look credible - sometimes even ‘cloning’ legitimate investment platforms.
“These will typically look almost identical to the real thing, apart from a small difference in the URL.
“Needless to say when unsuspecting investors deposit funds into one of these fake websites, they never see them again.”
Elsewhere, the firm said one investor told police that in 2022 they lost £4mn to a single financial scam on social media, which was almost six times more than the biggest single loss recorded in 2021 of £700,000.
In addition, 24 children aged under 10 were caught out by scams on social media, with 593 victims aged under 20.
Losses to financial fraud on social media by platform
“Something is going seriously wrong if children under 10 can be conned by these despicable money-grabbing scammers,” Berry said.
“If you’re looking to invest, make sure you’re dealing with a trustworthy, FCA-regulated company and do plenty of careful research before you take the plunge.
"There is never an urgency to investing, and if you feel under any pressure, or if something looks too good to be true, it probably is.”
sonia.rach@ft.com
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