When I think of social media, I think of sharing updates and pictures with friends and family over platforms like Instagram and Facebook; however new research shows social media is quickly becoming a favourite tool for scammers to contact their victims.
According to new research from BBB Institute for Marketplace Trust, FINRA Investor Education Foundation and the Stanford Center on Longevity, individuals who are contacted with fraudulent schemes through social media are more likely to lose money than those whom are contacted by phone or email.
Based on a survey of 1000 Canadians and Americans, the research shows those who were targeted by social media (and reported the fraud to BBB) found that 91% of respondents engaged with the scammers and 53% lost money.
Comparably, when the fraud was initiated through a website 81% engaged and 50% lost money.
Interestingly, or maybe a sign of the times, very few consumers engaged or lost money to scammers when targeted through email or by phone.
The study also shows that the victims of financial fraud have a common social element. Those that are more likely to engage with scammers and lose money reported having significantly higher levels of feelings of loneliness. Fraud victims are more likely to be single, divorced or widowed; “Social isolation appears to play a role in fraud victimization,” the FINRA Foundation said in a release.
On a positive side, the research uncovered that frontline financial industry personnel helped many consumers avoid becoming victims of fraud. The report said financial service companies, bank tellers, cashiers and wire transfer employees all served well as a last-line-of-defence when consumers inquired about transferring money – to scammers.
The study also reported young consumers, people under financial strain and those with poor financial literacy were the most likely to become victims of financial fraud.
In this new age of cyber fraud, it is important to be aware of the dangers and how to protect yourself and your money. First and foremost, trust your instincts; if it doesn’t feel right take a moment and ask someone’s opinion that has no stake in the outcome. Do some research on the individual or organization before sending your money or sharing personal information.
The Competition Bureau Canada has a great handbook called The Little Black Book of Scams 2nd Edition outlining the most common scams, download your copy at:
https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/04333.html
Have a great weekend,
Tracey
Source: Original article posted on Advisor’s Edge website by James Langton, 01-10-19, Competition Bureau Canada website