According to Cointelegraph, a group of Democratic senators in the United States have asked Mark Zuckerberg, CEO of Meta, to provide data on the social media company’s policies on cryptocurrency fraud.
According to Cointelegraph, senators Robert Mendez, Sherrod Brown, Elizabeth Warren, Dianne Feinstein, Bernie Sanders, and Cory Booker, among others, made a statement on Zuckberg for actions his company may take to detect cryptocurrency-based scams, coordinate with law enforcement, and assist victims in frauds, according to a report from the Washington Post. Currently, Meta is in charge of Facebook, WhatsApp, Messenger, and Instagram.
“Based on recent reports of scams on other social media platforms and apps,” the senators reportedly stated, “we are concerned that Meta provides a breeding ground for cryptocurrency fraud that causes significant harm to consumers.”
According to Cointelegraph, the lawmakers referred to a Federal Trade Commission report that labeled social media and cryptocurrency as potentially fraudulent. According to the commission, approximately half of the one billion dollars in cryptocurrency-related scams that occurred in 2021, the majority of which focused on investments, grew from social media platforms.
“Nearly four out of every ten dollars reported lost to a social media fraud was lost in cryptocurrency, far more than any other payment method.” According to the report, “the top platforms identified in these reports were Instagram (32%), Facebook (26%), WhatsApp (9%), and Telegram (7%).”
Furthermore, Cointelegraph reported that Democratic Senators demanded that Meta provide warnings in languages other than English to potential scammers. According to Meta spokesperson Andy Stone, the social media platform used resources to prevent scams. The US Federal Bureau of Investigation also targeted cryptocurrency scams by alerting the public to applications that use the same logos and information as legitimate businesses. Scammers have victimized users on Twitter and YouTube by using hacked accounts, copycat websites, fake cryptocurrency projects, and airdrops, among other methods.
Around 32% of consumers who reported being swindled out of cryptocurrency said the fraudulent activity took place on Instagram, 26% on Facebook, and 9% on WhatsApp. The lawmakers cited a Federal Trade Commission report from June 2018 that called social media and cryptocurrencies “an explosive combination for fraud.”
According to the FTC report, social media platforms accounted for roughly half of the $1 billion in cryptocurrency-related scams in 2021, with the majority of them involving investments. Legislators wanted to know if Meta provides “warnings or educational materials about cryptocurrency scams in languages other than English.”
According to Andy Stone, a Meta representative, the scams violate company policy and harm the company’s business. As a result, it devotes “considerable resources to detecting and preventing fraud.”
According to a June 2018 FTC report, over 46,000 people have reported losing more than $1 billion in cryptocurrency to fraudsters since the beginning of 2021. Bitcoin investment schemes, rug pulls, romance scams, and phishing are just a few examples.
According to the FTC, the top three cryptocurrencies used to pay off scam artists were bitcoin (70%), tether (10%), and ether (9%). Almost $4 out of every $10 reported lost to social media fraud was in cryptocurrencies, far more frequently than any other payment method.
Instagram (32%), Facebook (26%), WhatsApp (9%) and Telegram (7%), according to these reports, are the leading platforms. However, Meta platforms are not the only places where cryptocurrency scams are common. Twitter has also received numerous reports of cryptocurrency fraud and bots.
Recently, cybercriminals were able to carry out a cryptocurrency scam by streaming a YouTube video promoting bogus cryptocurrency investments during a concurrent Apple event.
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