President Trump’s Federal Trade Commission released new data showing that social media platforms have become the platform through which Americans lose the most money to scammers.
Americans lost more than $2 billion last year to scams that originated on social media. The report astonishingly showed that losses increased eightfold since 2020.
The FTC's report makes clear that social media is no longer merely a place where people share photos, argue politics, or follow brands. It has become a hunting ground for fraud rings, including international criminal networks that can target Americans from anywhere in the world.
And Big Tech knows it.
The platforms will say they are victims. They will say scammers abuse their services, evade detection, and adapt quickly. All of that is true. But it isn’t the entire story.
Scammers are simply using the system as designed. They buy ads. They target users. They exploit personal data. They test messages. They optimize engagement. The same machinery built to help businesses reach customers is now being used to separate Americans from their savings.
Investment scams are the clearest example. A user sees an ad or post promising easy returns. It looks professional. It may feature fake testimonials, fake experts, or a fake online community filled with supposed success stories. Soon the victim is directed to a fraudulent platform, often through messaging apps or social media groups. By the time the snake oil sale is revealed, the money is in the scammers’ pockets.
Shopping scams work the same way. They’ll show you an ostensibly credible ad offering you a steep discount on clothes, electronics, car parts, or even pets. But then, the product never arrives, or the seller disappears.
Romance scams are even more insidious and invasive. Scammers study their prospective victims well before engaging them so it becomes easy for them to build rapport and trust. They then use that trust to invent crises that only providing them money will solve.
Silicon Valley has made these cons commonplace and, as the FTC report indicates, rampant.
Look, no one expects a platform to catch every fraudster or address every harm. But Americans are entitled to expect more than after-the-fact apologies and vague safety pledges and another quarterly transparency report buried on a corporate website.
Big Tech has spent years proving it can police content aggressively when it wants to. It can demote posts, remove accounts, verify advertisers, track networks, and build elaborate systems to enforce its own rules. Yet when the issue is fraud that drains people's bank accounts, the urgency too often disappears. That, too, is a choice.
If a bank repeatedly allowed criminal networks to use its infrastructure to steal from customers, regulators would not accept "we are working on it" as an answer. If a physical marketplace kept renting stalls to counterfeiters and thieves, no one would treat it as a neutral bystander. Social media companies should not get a special exemption simply because their business model is digital.
The first step is obvious: paid advertising must face real verification. If a platform accepts money to promote content, it should know who is paying and whether the offer is legitimate. That can only happen if verification is mandatory on the frontend.
Second, platforms should disclose how many scam ads they catch on their platform, how fast (or slow) they remove them, and how much revenue fraudulent campaigns generate before they are taken down. Big Tech’s intentional opacity has left the public in the dark about which of these social media platforms they can trust, while allowing the platforms to evade public scrutiny.
Third, liability cannot remain off-limits. If platforms profit from systems that repeatedly expose Americans to fraud, they should face consequences when they fail to act responsibly. They shouldn’t be rewarded by being able to monetize fraud.
We need to restore commonsense rules to the digital marketplace. We cannot treat a platform that reaches billions of people like a static bulletin board any longer. This is particularly true when scammers profit by billions of dollars at the expense of working-class families.
The FTC's warning should mark a turning point. The Trump administration has identified the problem and signaled that enforcement is back. Now Big Tech must decide whether it will clean up its platforms voluntarily, which we know they won’t do, or have Washington force the issue. We know the scam economy is not going away on its own. It is growing because the conditions for it are too favorable: low cost, global reach, weak accountability, and endless access to American consumers.
Until platforms face real accountability, scammers will continue to view social media as the easiest place in the world to steal from Americans.
Joel Thayer is a Senior Fellow for AI and Emerging Technology Policy at the America First Policy Institute. He also serves as President of the Digital Progress Institute and is a tech and telecom attorney.