Mark Zuckerberg-led Meta Platforms, Inc. META on Thursday announced new efforts to combat the growing threat of “pig butchering” scams, which have cost Americans billions of dollars each year.
What Happened: Pig butchering scams typically involve scammers building fake online relationships with victims before convincing them to invest in fraudulent investment schemes, often involving cryptocurrency.
These scams take months to develop, with scammers using dating apps, social media platforms, and messaging apps like Telegram and WhatsApp to lure in victims.
The U.S. Institute of Peace estimates that up to 300,000 individuals were coerced into participating in scams globally by these criminal organizations, resulting in about $64 billion in stolen funds annually as of 2023.
See Also: Meta Confirms Layoffs Across Instagram, WhatsApp And Reality Labs Amid Strategic Reshuffle
According to Meta, the tech giant has taken down more than 2 million scam-related accounts this year and will begin flagging potential scam messages across its platforms, including Facebook, Instagram, and WhatsApp.
Meta is sharing information with international law enforcement to help identify and shut down criminal networks behind these scams.
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Why It Matters: Pig butchering scams are a growing issue, with the FBI reporting nearly $12.5 billion in losses from online fraud in 2023 alone, marking a 22% increase from the previous year.
In May 2024, Meta, Match Group Inc. MTCH, the owner of Tinder and Hinge, and several cryptocurrency firms formed a coalition.
Known as the “Tech Against Scams” coalition, these companies committed to exchanging information about scammers and improving user education.
However, that doesn't mean Zuckerberg's Meta has not faced criticism for its role in Fraud cases.
Earlier this year, South Korea’s antitrust regulator examined the possibility of sanctions against Meta over alleged failures in consumer protection on its online marketplaces.
In December 2022, Zuckerberg faced a lawsuit for his platform’s involvement in a marijuana investment scam.
Some anti-scam advocates believe tech companies’ efforts to combat pig butchering are insufficient and delayed.
Jake Sims, co-founder of Operation Shamrock, a global coalition dedicated to tackling scams and the criminal networks behind them, stated that merely warning users and occasionally removing accounts doesn’t address the full scope of the criminal activity involved.
“After three years of Meta's awareness of this problem on their platforms, the situation is getting worse, not better,” Sims told NBC News.
Price Action: Meta’s shares fell by 0.43% on Thursday, closing at $563.09, and dropped an additional 0.34% in after-hours trading, reaching $561.18 as of this writing, according to data from Benzinga Pro.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
Photo courtesy: Meta
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