SNS Investment Scams Outpace 'Phone Scams' in Losses
Photo: ITmedia
Quick answer
Investment fraud losses via social networks in Japan have exceeded ¥1.2 trillion, surpassing traditional phone scams.
Japan has recorded a record-breaking ¥1.27 trillion (approximately $8.5 billion) in losses from fraudulent investment schemes conducted via social media. This figure now exceeds the damages caused by traditional phone-based scams, commonly known as ore-ore sagi (fraud disguised as relatives).
Experts highlight three key factors fueling the spread of these schemes: the ease of creating fake accounts impersonating celebrities, the complexity of tracking financial transactions, and the minimal costs required to launch fraudulent campaigns. Scammers frequently exploit platforms such as Facebook* and Instagram* to target victims.
Taiwan has demonstrated an effective counter-strategy. Over the past year, the country reduced fraud losses from similar schemes by 30 times through its citizen participation system. Social media users can now report suspicious accounts in real time, while authorities have strengthened oversight of financial transactions and implemented automated blocking mechanisms for fraudulent operations.
Japan has also initiated changes to combat fraud. Authorities are collaborating with social platforms to rapidly remove suspicious accounts and launching awareness campaigns to educate users about the risks.
* Facebook, Instagram, WhatsApp, and other Meta services are owned by Meta Platforms Inc., whose activities have been recognized as extremist and banned in the Russian Federation.
Common questions
- Why is SNS investment fraud so widespread?
- Scammers leverage fake celebrity accounts, the anonymity of social platforms, and the difficulty in tracking financial transactions. The low barrier to entry allows rapid scaling of fraudulent schemes.
- How did Taiwan reduce fraud losses by 30 times?
- Taiwan implemented a citizen participation system where users report suspicious accounts, alongside technological measures like blocking fraudulent transactions and enhanced verification processes.
- What measures is Japan taking to combat SNS fraud?
- Japanese authorities have launched new initiatives, including partnerships with social platforms to swiftly remove fraudulent accounts and educational campaigns to raise public awareness.
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