Scammers are using fake news websites that mimic trusted media brands to spread and promote investment fraud, according to digital risk protection platform CTM360.
The company identified more than 17,000 of these “baiting news sites” (BNS) across 50 countries, it said in a July 7 report.
These sites are promoted through fake news articles posted through ad platforms like Google Ads, Meta Ads or social media, are designed to look like legitimate news outlets, and publish fabricated stories designed to lure readers into scams, according to the report.
Across the different countries in which they appear, the sites often use native languages, recognizable media brands and regional public figures to make them more credible to local audiences, the report said.
These sites then redirect individuals to fraudulent investment platforms that prompt them to submit their personal details to set up an account and wait for a phone call from an “agent,” per the report.
In some cases, after prompting individuals to make a small initial deposit, these sites show fake returns and encourage the victims to invest more, according to the report.
When victims attempt to withdraw funds, they are unable to do so, with the platforms saying that there are system errors or other issues or that the victim must pay a fee to unlock the funds, per the report.
The Federal Trade Commission reported in March that consumers reported losing more money to investment scams — $5.7 billion — than any other category in the previous year. That figure represented a 24% increase over 2023.
“The data we’re releasing today shows that scammers’ tactics are constantly evolving,” Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said when announcing the findings. “The FTC is monitoring those trends closely and working hard to protect the American people from fraud.”
The PYMNTS Intelligence report “The Impact of Financial Scams on Consumers’ Finances and Banking Habits” found that 21% of financial scams start on social media.
The report also found that 3 in 10 consumers in the United States, or about 77 million individuals, reported suffering financial losses to scams in the previous five years.
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