Michigan Attorney General Dana Nessel issued an investor alert on Apr. 9 warning residents about a rise in fraudulent investment schemes spreading across Meta platforms, including Facebook, Instagram, and WhatsApp. The alert comes as scammers increasingly use deceptive ads and deepfake technology to target individuals with pump-and-dump scams, confidence scams, and fraudulent cryptocurrency offers.
The warning is significant because these schemes are designed to extract money from victims by taking advantage of their trust and lack of awareness about online fraud. According to Nessel, “Social media has become a breeding ground for fraudulent ads, making it hard to separate legitimate investments from sophisticated scams. By recognizing the red flags and staying vigilant, you can help protect your personal information and savings.”
The attorney general’s office outlined how pump-and-dump scams work: scammers lure victims into groups promoting cryptocurrencies or low-priced stocks using unauthorized images of public figures or financial advisors. Victims are often pressured to move conversations onto encrypted apps like WhatsApp or Telegram before being convinced to invest large sums in assets that are artificially inflated then quickly sold off by the scammers.
Confidence scams involve building relationships with victims through fake investment platforms that mimic real trading sites. Scammers may let victims withdraw small profits initially but eventually invent fees or taxes when larger withdrawals are attempted—at which point they disappear with the funds.
Nessel provided several tips for residents: be wary of promises of guaranteed returns; avoid high-pressure tactics; verify credentials using FINRA’s BrokerCheck; consult trusted advisors before investing; and watch out for AI-generated videos impersonating celebrities giving financial advice.
According to the official website, the Michigan Department of Attorney General advances social efforts through actions against human trafficking and support for vulnerable populations according to the official website. The department also focuses on serving Michigan residents through initiatives in public service and protection according to the official website, while exercising authority throughout Michigan to safeguard residents according to the official website. Dana Nessel has served as Michigan’s 54th attorney general according to the official website. In addition, the department influenced policy by drafting Clean Slate legislation in 2019 that expanded expungement opportunities according to the official website.
Residents who believe they have been targeted by such schemes are encouraged by Nessel’s office to report incidents directly via consumer complaint forms or contact information provided on state websites.
