As of October 2024, 5.52 billion people, 67.5% of the global population are Internet users. Among them, 5.22 billion, or 63.8% of the world’s population, actively used social media. The statistics show the prominent use of social media by people around the globe. It is also a common medium for businesses to reach their target audience and promote their brand and products.
But what if your business is used by spammers to trick your audience? As per a report, there has been an increasing number of social media frauds. In the United States, the number of cybercrime incidents, including online fraud, has increased significantly from around 467,000 in 2019 to more than 880,000 in 2023.
In this blog, we’ll explore social media fraud and strategies to build an effective prevention plan.
What is Social Media Fraud?
Social media fraud is where a fraudster or a scammer uses social media platforms to trick or deceive people for personal gain, often involving money, sensitive information, or accounts. Fraudsters use fake profiles, scams, or phishing techniques to manipulate users.
Common Types of Frauds
1. Brand impersonation
They impersonate the Ads, emails, WhatsApp messages, or posts of legitimate brands and offer deals that are too good to be true, leading people to buy fake or non-existent products. Sometimes they also reach out to the brand’s customers impersonating their representative and they convince users to share sensitive information as seen in the below image:
2. Account hacking
Fraudsters hack into social media accounts and misuse them in various ways. They might create fake profiles, send harmful links to the user’s contacts to steal login credentials, or even ask for money by pretending to be the account owner. These accounts can also be used to post harmful content or spread hate against certain groups, causing further damage.
3. Phishing schemes targeting customers
Fraudsters send fake messages or emails pretending to be from trusted platforms to steal sensitive information. Scammers use direct messages or fake login pages to trick users into sharing passwords, credit card details, or other private information. These schemes often involve urgency, such as “Your account will be deactivated unless you verify your login now.” According to a 2024 study by Egress on phishing trends, 94% of businesses were victims of phishing attacks, with 96% being negatively affected by it.
4. Fake reviews and testimonials
Scammers write fake reviews to trick people into buying their products. They use fake profiles to give five-star ratings and make the product look good. This misleads customers, who trust the reviews and buy products that are either bad quality or not what they expected. You can read more about spotting fake reviews here. All users should always do a thorough background check for a brand or product to ensure that it is not another fraudulent activity on social accounts.
5.Quizzes and personality tests
Quizzes and personality tests are popular on social media because they’re fun and spark curiosity. However, some of these quizzes can be social media scams designed to trick users into sharing personal information or login credentials. Scammers then misuse this data for their own purposes. Each year, 80 million people take personality tests, many of which are scams. Scammers use these quizzes to steal passwords and access social media accounts.
6. Romance Scams
In 2023, the Federal Trade Commission (FTC) reported over 64,000 romance scams, resulting in a loss of $1.14 billion. Romance scammers often contact victims through dating apps, text messages, emails, or social media platforms. It is important that users should get overly cautious when some online friend is asking for money or asking them to invest in a specific product or service.
Recognizing the Signs of Social Fraud
1. Suspicious accounts mimicking your brand
Scammers may create fake accounts that look like your brand by using your logo or name to appear legitimate and post it on social media. They use these accounts to trick customers into sharing private information or making payments. Educate your customers to stay cautious by checking the URL for accuracy, looking for a padlock symbol, avoiding sites with grammatical errors, and verifying suspicious sites using a website checker.
2. Too good to be true
Scammers often lure people with promises of easy money or high returns on investments, packaged as “limited-time opportunities.” These deals sound attractive but are almost always fraudulent. Remember, if an offer seems too good to be true, it probably is a scam.
3. Unusual engagement patterns
If there is a noticeable change in the engagement patterns, then it might indicate some sort of social fraud is happening. For instance, you observe an increased number of negative comments or unusual traffic on your website.
4. Reports from customers about fraudulent interactions
If your customer reaches out to your team and talks about how they were reached out by a representative from your business or they received an email from your brand, then you must look into it and get to the root of this problem.
Protective Measures for Businesses
Account Security
Prevention is always better than cure. It is essential that you have strong account security policies in place that can aid in preventing fraud on social media. Some of the steps that you can take are:
- Strong password policy: All the entities whether they are business accounts or customer accounts should have a strong password policy in place that can be a mix of uppercase, lowercase, numbers, or special characters.
- Multi-factor authentication: Implement multi-factor authentication that adds another layer of defense that is hard to bypass. In these cases, the related entities will need to send a verification code that they receive on their email or phone.
- Regular updates: Auditing the security posture of your system regularly helps to detect any vulnerabilities in the system that can be exploited. It helps you to create a secure infrastructure for your business.
Privacy Settings
Regularly review and update the privacy and security settings of your business’s social media accounts. Restrict access to sensitive data and ensure only authorized personnel can manage your pages. Tight privacy settings prevent unauthorized access, reducing the risk of account hacking or misuse.
Cautious Sharing
Be cautious about the details your business shares publicly. Avoid disclosing operational or sensitive information, such as financial updates, employee contact details, or upcoming projects, that could be exploited by fraudsters. Also, never post about your whereabouts in real time as it can give hackers an opportunity to hack your account.
Inform the customers to avoid downloading software from links posted on social media as they can contain malicious software that can contain malware.
Monitoring and Reporting Fraudulent Activity
Continuously monitor your business’s social media presence for signs of fraudulent activity on social accounts, such as fake accounts impersonating your brand, unauthorized posts, or unusual login activity. It is crucial to implement tools to automate fraud detection when possible.
One of the primary steps in social media fraud prevention is to have an incident management plan in place. It means that your business should be ready to take action in case a social media fraud has occurred or there are some suspicions related to it.
The plan should include:
- Fraud identification
Train employees to identify signs of fraudulent activity, such as fake accounts impersonating your brand, phishing attempts, or unauthorized transactions. Establish protocols to gather evidence, including screenshots, transaction logs, and suspicious URLs.
- Report to Social Media Platforms and Tools
Use platform-specific tools to report fake profiles, phishing messages, or fraudulent posts impersonating your business (e.g., Facebook’s Business Support, Instagram’s Report Tool).
- Engage Your Security Team
Notify your internal IT or cybersecurity team to investigate and block fraudulent domains, accounts, or IPs. Activate safeguards like two-factor authentication or IP whitelisting to secure your accounts.
- Alert Affected Customers and Stakeholders
Send communications to customers or partners who might have been targeted, warning them of potential scams. Provide them with steps to secure their accounts and avoid sharing sensitive information with impersonators.
- Report to Authorities and Agencies
For large-scale fraud, file complaints with relevant cybercrime authorities, such as the FTC in the US or CERT in your country. Partner with law enforcement to take legal action against perpetrators when possible.
- Strengthen Prevention Strategies
Review incident details to improve your fraud detection tools and processes. Regularly update staff training, response protocols, and customer awareness campaigns to mitigate future threats.
Tools for Social Media Fraud Prevention
1. Sensfrx
Sensfrx is a robust fraud prevention solution designed to protect businesses from threats like account takeovers, fake registrations, bot attacks, and fraudulent transactions. With advanced risk scoring, real-time analytics, and customizable policies, it empowers businesses to detect and block suspicious activities while ensuring a smooth experience for genuine users. Sensfrx helps safeguard your revenue, brand reputation, and customer trust.
2. Proofpoint Social Discover
Proofpoint Social Discover helps businesses identify and mitigate threats on social media platforms, such as phishing, impersonation, and unauthorized brand use. Its advanced analytics provide visibility into social media risks, ensuring brand reputation and customer trust remain intact.
3. SEON
SEON offers fraud prevention solutions that detect suspicious user behaviors, such as unusual transactions or fake accounts. Its machine learning capabilities allow businesses to customize risk scoring and block threats in real-time.
4. Sift
Sift specializes in fraud detection and prevention using AI-driven insights to analyze user behavior and transaction data. It helps businesses reduce chargebacks, prevent account takeovers, and maintain secure customer interactions.
5. EY Forensics Services
EY Forensics Services assists organizations in detecting, investigating, and responding to fraud and misconduct. With expertise in risk assessment and advanced data analysis, it helps businesses safeguard assets and ensure regulatory compliance.
6. DataDome
DataDome offers advanced bot protection, shielding businesses from automated threats like credential stuffing and fake registrations. Its real-time analytics ensure that malicious traffic is blocked while legitimate users experience seamless access.
Educating Employees and Customers
To protect your business, it’s important to teach employees and customers how to spot phishing and fraud. Show them examples of fake emails, suspicious links, or offers that seem too good to be true. Give simple tips, like not sharing personal information and using strong passwords. When people know what to watch out for, they can help keep your business safe. It is one of the most basic yet powerful ways that can help you with social media fraud prevention.
Conclusion
In this blog, we talked about what social media fraud is and how businesses can stop it. We also shared a list of tools and strategies that can help prevent these frauds from happening. If you are looking for a fraud prevention tool then the Sensfrx free trial is your way to go. It offers a range of fraud detection features that will suit your business needs. So, what are you waiting for? Book your Sensfrx free trial now.
