Why celebs are the hot new targets for scammers
With the prospect of earning thousands of pounds per post, social media influencing is becoming a sought-after and lucrative career move for celebrities and bloggers alike. However, some celeb endorsements have backfired with the rise of Instagram scams that have seen social media users conned out of cash. Closer investigates...
Social media has skyrocketed over the last decade, with Instagram now hosting over a billion active users since it launched in 2010.
The explosion has seen a rise in social media influencers, where celebrities and bloggers make money by promoting products and services to their thousands – in some cases millions – of Instagram followers, with their earning potential increasing with the more likes and followers they can generate.
These accounts have become targets for business owners who can fork out anything from pennies to the reported £1.1m that footballer Cristiano Ronaldo can reportedly charge for just one sponsored post on his Instagram.
FAKE PROFILES
However, a number of celebritypromoted scams have emerged where influencers are being contacted by fake profiles to unwittingly promote false businesses in the hopes that celebrity followers will be directed to the page – and scammed for hundreds, sometimes thousands of pounds.
Just last week, fans of Geordie Shore’s Sophie Kasaei revealed how they’d been duped into handing over money to a fake account posing as a foreign exchange trader. The reality star, who believed the company was legitimate, promised followers they could turn hundreds into thousands by investing.
Clare Radford, 32, and Jade Smith, 27, from Nottingham, said they’d been left “worried sick” after investing almost their entire monthly paychecks after Sophie, 31, promised on her Instagram Stories that the scammer, named “Bethany”, was “well-known in the industry”.
Their stories echo those of fans of Katie Price – aka Jordan – who unknowingly promoted the financial services of a rogue trader who called himself “Josh Chandler”, who had paid Katie a reported £3k to promise her 2.6m followers they could turn their hard-earned money into thousands by investing – later to be told there would be a “release fee” of £725 to start the process.
Katie apologised to her followers, revealing she would “seek justice” for her conned fans, including a nurse who had “invested” nearly all of her wages. The case is being investigated by the Advertising Standards Authority, with Katie facing a potential social media ban. And a spokesperson for Sophie Kasaei’s management team said that her post did go through the “usual company checks without any cause for concern”. This included “company registration check, director background, credit rating, Instagram account review, relevant director and business searches and who else they have worked with.”
ONLINE FRAUD
Last month, Money Saving Expert’s Martin Lewis warned social media users to beware of scammers illegally using celebrity images, including the likes of Bear Grylls and Holly Willoughby, to lure victims to scams – usually involving a crypto-currency like Bitcoin.
But worryingly, the number of cases is rising, with a survey done by Which? claiming that £2.3bn was lost to online fraud in 2020.
With one-in-five UK children reporting their career ambitions include “influencer”, the social media machine isn’t set to slow down. Financial expert Jasmine Birtles, who runs Moneymagpie.com, says, “These scams are sophisticated and run by criminal networks with deep pockets. So celebrities need to be vigilant. Sometimes their managers or agents can do background research, but if they don’t have one, it’s up to them. It’s a shame that celebs have still been tricked – it’s important for all influencers to check. If something seems too good to be true, it probably is!
“I receive emails from people who’ve been scammed through social media, and it’s hard to know what to tell them because it’s unregulated. Once the money’s gone, it’s gone. But
I tell people to be careful of investment opportunities and never to trust anything they only see on social media. Millennials, especially, see it as a way to earn quick cash, but even making a legitimate investment requires knowledge, so I’d advise taking a verified quick course, like our MoneyMagpie webinars.
“When it comes to influencers without a financial background, I recommend that they stay away from companies offering either crypto or forex products.
“In fact, if they’re approached by any financial company – even high street banks – they should get their lawyers or financial advisor to research them and confirm that they are legitimate, and that their offer is genuinely profitable before broadcasting them to their followers. They should also have contracts drawn up including a clause about compensating them and their followers if they lose money through their schemes.”