Are Facebook Scams Considered to Be Fraud?

 Posted on April 22, 2024 in Fraud

Over the past several years, the number of people who have been affected by online scams has grown considerably. These scams may take a number of forms, but they have become especially prevalent on Facebook and other social media platforms.

People who use these platforms, including many elderly people who may not be technologically sophisticated, are often fooled by deceptive ads, accounts that impersonate well-known figures, and false claims. The authorities are working to combat these scams and protect people against fraudsters who are seeking to steal people’s money or commit offenses such as identity theft or other white collar crimes.

At Woolf Law Firm, LLC, our attorney provides representation to people who have been charged with criminal offenses, including those who may face accusations of involvement in social media scams, identity theft, or money laundering. With our understanding of the state and federal laws that apply in these situations, we can help determine the best ways to respond to investigations by law enforcement and criminal charges in state or federal courts.

Facebook Ad Scams Related to Prominent Investors

One type of scam that has recently gained some attention involves Facebook ads that impersonate people who are well-known in the financial industry. These ads feature photos of people such as Bill Ackman of Pershing Square Capital Management, Cathie Wood of ARK Investment Management, Peter Lynch of Fidelity Investments, and Steve Cohen, a hedge-fund manager who owns the New York Mets. They will often promise to provide advice on how people can earn large profits from investments, and they may also include “deepfake” videos created using artificial intelligence that supposedly show these figures claiming that people who join them can become rich.

The ads encourage people to join groups on WhatsApp, a messaging platform that is owned by Meta, Facebook’s parent company. In these groups, they can supposedly receive investment advice from people who are associated with the famous people featured in the ads. However, the advice provided is often false or misleading, and it usually consists of “pump and dump” schemes in which people are encouraged to purchase stocks and inflate prices, after which the scammers sell their own shares of the stock, causing prices to fall and making the remaining stocks worthless. 

People affected by these scams have reported that the scammers appeared to provide legitimate investment advice while making promises of high returns. They have encouraged people to invest more money by mortgaging their homes, liquidating retirement accounts, or borrowing from family and friends. As a result of these scams, people have lost millions of dollars.

Criminal Charges for Online Scams

These scams are a form of fraud, since scammers make false representations about their identities and connections, and they make misleading claims about what people can expect when making investments. Obtaining money or other benefits through false pretenses can lead to charges of theft at the state level. However, since these scams involve the internet, it is likely that federal charges will apply. Scammers could potentially be charged with wire fraud or securities fraud, and if convicted, they could face penalties that include years or decades in prison and hundreds of thousands of dollars in fines.

Contact Our Hartford, CT Fraud Defense Lawyer

If you have been charged with fraud in connection to online scams, Woolf Law Firm, LLC can advise you of your rights and options and help you defend against a conviction. Our Connecticut white collar crime attorney has experience representing clients in both state and federal court, and we can help you determine the best strategies to use during your case while protecting your rights at all times. Contact us at 860-290-8690 to discuss your case in a free consultation.