Do your research and don't fall for these fake celebrity scams

AUSTRALIANS are getting fleeced by a growing number of celebrity endorsement scams that are proliferating social media.

There’s a reason brands like using celebrity endorsements — they put a friendly and trustworthy face to a product. But it’s a tactic that apparently also works for online fraudsters.

According to ScamWatch, reports of celebrity endorsement scams have increased by 400 per cent, and most shockingly, the amount of money people have lost has increased a staggering 3800 per cent so far in 2018.

The data comes from the dedicated online fraud unit overseen by the Australian Competition and Consumer Commission (ACCC). It received almost 200 reports in 2018 and losses totalling more than $142,000.

“The growth in these scams is very concerning, particularly as over half the reports we received included a financial loss. Most people lost between $100 and $500 and in one case, a victim lost more than $50,000 through fake celebrity endorsement of an investment scheme,” ACCC deputy chair Delia Rickard said.

The scams include celebrities like Delta Goodrem, Kyle Sandilands, Lisa Wilkinson, Meghan Markle and Shark Tank’s Steve Baxter.

The ads include fake quotes and doctored images of well-known personalities promoting products such as skin care creams, weight loss pills or investment schemes.

In the case of skincare and weight loss scams, typically they work by encouraging consumers to sign up for a “free trial” of a product.

“When you apply you have to give your credit card details, and they will then automatically roll you into an ongoing subscription unless you cancel within an impossibly short time frame,” Ms Rickard told news.com.au.

Investment schemes lure victims with promises of huge returns. If they hand over money, the scammers will then “start showing great returns to con you into putting in more money, but of course if you try to take it out it won’t be there”.

The ACCC said it is calling on Facebook and Instagram to do more to crack down on such fake ads that appear on its platforms and also singled out Google, calling on the search engine giant to help prevent scammers reaching potential victims.

It comes as Channel 9 TV host Sonia Kruger slammed “disturbing” ads which used her image to sell skin care products while last month fellow Channel 9 star Georgie Gardner also hit out at scams which appropriated her image and tried to look like news items.

Facebook says it took down 837 million pieces of spam from January to March 2018.

“We also disabled about 583 million fake accounts — most of which were disabled within minutes of registration,” Facebook Australia head of communications Antonia Sanda said in a statement provided to news.com.au.

“This is in addition to the millions of fake account attempts we prevent daily from ever registering with Facebook.”

But some of the scams flagged by the ACCC that can make their way to social media can be quite convincing and appear to be legitimate businesses at first glance.

“Scammers are getting more sophisticated,” Mr Rickard said. “They know people respond to celebrity endorsement and there’s a lot of money to be made.”

A majority of victims who fell prey to these sorts of online scams were older. Of those who reported to ScamWatch, people aged 45 and older accounted for 63 per cent of losses. And women were more likely to be duped than men.

To avoid being caught up in such scams, do your homework before signing up to anything, the ACCC urged.

“It is vital to research and read independent reviews of the company. Consumers should verify celebrity endorsement of products from the celebrity’s official website or social media account,” Ms Rickard said.

The ACCC says if a consumer is caught in any of these scams, the best thing to do is contact their bank and arrange a chargeback and stop any further debits to their credit card.

For its part, Facebook, which also owns Instagram where the line between celebrity endorser and fraud can become particularly blurred, said it was using new systems to weed out fraudulent content.

“New technology like machine learning, computer vision and artificial intelligence helps us find more bad content, more quickly,” Ms Sanda said.

“We are also investing heavily in more people to review content that is flagged. From time to time people may see an ad that they believe is false and we encourage people to report these so that we can take steps to prevent these from appearing.”

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