In recent months, many well-known hedge fund managers on Wall Street have been troubled by one thing: how to eliminate advertisements on social media that use their own names to deceive and deceive.
According to the screenshot of the victim's spread on the Internet, one of the fake Ackerman promotion accounts wrote: "I am Bill Ackerman, the founder of Panxing Plaza Capital... I have made a lot of money in a short time, and now I am pursuing more meaningful attempts... I will use WhatsApp (Meta's instant messaging software, similar to WeChat) Share valuable insights in the group Quickly click on 'Register Now' to obtain the 2024 stock wealth code. "
(Source: Social media, WSJ)
Scam advertisements are constantly emerging
Smart readers of Caixin News Agency can definitely see at a glance that this kind of behavior of promoting "free distribution of wealth codes" through advertising is definitely not good. However, in reality, the strategy of this kind of scam is just to launch crazily on the Internet, and one can be deceived by another.
Pan Xing Square Capital's spokesperson, Fran McGill, helplessly stated that the company has discovered over 90 fraudulent advertisements that counterfeit Ackermann so far. Among them are those who promise an annualized return of 125%, those who earn 25% a week, and those who hold these three stocks and you will become a millionaire.
McGill stated that in some cases, even if the company reports to Facebook, some fraudulent advertisements will continue to be displayed for several weeks before being removed. More importantly, when some fraudulent advertisements are removed, new fraudulent advertisements will immediately emerge. McGill compared this to "hitting the ground mouse" and called on social media platforms to take more measures to prevent ordinary people from being deceived for nothing.
Ackermann is not the only financial tycoon targeted by scammers. Catherine Wood (Sister Wood) from Ark Investment, Peter Lynch from Fidelity Investment, renowned hedge fund manager Steven Cohen, and even Dalio, who had retired from the position of head of Bridgewater Fund a year and a half ago, have become counterfeit targets of false fraud advertisements.
With the development of AI technology, this type of fraudulent advertising has also adopted deep forgery technology in keeping with the times. For example, in a fake video of Lynch accepting an interview with CNBC, the legendary fund manager said, "Join us, you will have the opportunity to double your income and achieve financial freedom more easily.".
In response to this situation, the US Financial Services Administration (Finra) issued a warning at the beginning of the year that there was a significant increase in complaints from investors due to fraudulent social media promotion by "investment groups.". The Federal Trade Commission of the United States also stated that from 2019 to 2023, the losses caused by such fraudulent impersonation have doubled to $2.7 billion, and this type of scam is becoming "increasingly common and harmful".
The recommendation from "Wall Street Masters" turned out to be Hong Kong Fairy Stocks
This type of scam is essentially not very innovative. After the victims click on the scam advertisement, they will be redirected to the page where they fill out their information. After answering some questions about investment experience, they will be pulled into the WhatsApp group. There will be dozens of people inside, but most of them are disguised as scammers - the group will be filled with praise for the group leader and repeatedly emphasize to the victims that the stocks they recommend are profitable.
A construction company owner named Peter Bourget publicly recalled that after getting tired of traditional banks and financial advisors promising "if the US stock market doesn't crash, you can earn 5% -10% a year", he clicked on an ad link saying "Wooden Sister takes you to make big money". After joining the group, the scammers in the group will encourage him to liquidate his 401K pension investment account, mortgage his house, and borrow money from friends to buy the recommended stocks in the group to "double".
As expected, Bourget quickly lost tens of thousands of dollars after buying Hong Kong stocks recommended by scammers. At this point, the scammer suggested to him that he could bear 80% of the loss, provided that Bourget continued to invest in the transaction. Until then, Bourget suddenly realized that he had been deceived.
In real cases, these scammers also engage in the practice of "fishing for big fish with long lines". A couple represented by investment lawyer Josh Kons from Connecticut lost $1.3 million in such scams.
Kons stated that under the command of the fraudster, his client made profits in four out of five US stock exchanges from October to November last year, and also earned a 15% return on a Hong Kong stock in early December.
Next, the fraudsters urged them to increase their investment efforts and buy two Hong Kong stocks - Dream East (HK. 00593) and Hongqiang Holdings (HK. 08262) - by the end of December. On the day the couple bought, both stocks plummeted by 90%.
(0593, 8262 daily chart, source: TradeView)
Blake Snyder, senior director of the intelligence department of the Financial Industry Regulatory Authority, stated through a spokesperson that the agency believes that most of these activities are planned by individuals outside of Finra's jurisdiction, and there is a high probability that scammers are located outside the United States.
Facebook also has a saying
A group of 9 victims wrote to Facebook on February 28 this year, stating that they had reported a total of 21 fake advertisements related to Ackerman, Mujie, and Cohen to the platform between January and February this year. However, without exception, Facebook's support team replied that the advertisement did not violate platform standards.
Facebook's parent company Meta stated in 2021 that the company has 40000 employees and external contractors responsible for addressing security issues, including using AI to prevent fake accounts. However, some Internet industry observers also questioned that with successive rounds of layoffs, Meta's efforts may have been problematic.
Regarding the issue of counterfeit advertising fraud mentioned in this article, a spokesperson for Meta responded that scammers will use every platform they can and constantly adjust to avoid law enforcement. The company has invested a significant amount of resources in training the review team and equipped specialized detection tools to identify fraudulent activities, including identifying and prohibiting fraudulent advertisements that use celebrities as bait.
The spokesperson also disclosed that the company's policy encourages the reporting of false accounts and fraudulent advertisements. Just in the second quarter of last year, Facebook deleted 1.1 billion pieces of junk content, of which over 95% of posts were deleted before being reported.