The Instagram Money Scam: What It Is and How to Protect Yourself

How to stay safe and what to do if you're a victim

The Ultimate Guide to Instagram
The Ultimate Guide to Instagram

One of the more prevalent scams on Instagram is one known as the Instagram money scam. This scam involves being contacted by someone who claims they've discovered a way you can double or triple your money using a newly discovered hack in some system.

What is the Instagram Money Scam?

While this scam isn't exclusive to Instagram, it is more prevalent there.

This scam involves scammers sending a direct message to people who either like or follow official bank or other financial websites. The scammer will explain they've identified a loophole in the financial institution's system that allows them to take a very small investment from you and multiply it many times over.

A conceptual illustration of an Instagram Money Scammer.
Lifewire / Theresa Chiechi

How Does the Instagram Money Scam Work?

Scam artists who attempt to defraud Instagram users in this way plan out their approach carefully. Profiles are designed to look authentic, and include pictures of luxury items or piles of cash.

When they make public posts to draw in victims, they usually do so using the maximum number of hashtags allowed by Instagram. This is to attract a large number of interested Instagram users.

A typical Instagram Money Scam involves the following steps:

  1. The scam artist creates an Instagram account that looks authentic. It may appear like an individual person's account or a company. The profile usually features lots of cash or someone standing near high-priced luxury items, such as cars.

    Screenshot of a scammer Instagram account
  2. Next, the scammer creates a few posts on Instagram claiming you can multiply a small investment into a massive cash sum. The vehicle of the investment can be anything ranging from Bitcoin or Western Union to PayPal or a banking institution.

    Screenshot of an Instagram money scam post
  3. The scammer identifies people who follow the financial vehicle that's part of the scam. This is usually the Instagram account of a bank or other large entity with thousands of followers. The scammer views the follower list and works their way through it, sending scam messages to each follower.

    Screenshot of a scammer looking for followers
  4. Scam artists craft a convincing conversation to try and draw the Instagram user into the plot. The messages are direct and personable and make it seem as though they're just trying to help people out with a tip that could earn lots of money.

    Screenshot of a sample Instagram money scam message
  5. Once you show interest, the scammer asks for your bank account details or some other way to transfer over your "initial investment," Once you do, the scammer immediately blocks your account and disappears with your money.

How Do the Instagram Money Scammers Find Victims?

Scammers seek out a targeted audience for this scam and focus on people already interested in the investment vehicle they're claiming they've found a loophole for.

They look for users who show the following characteristics:

  • They've liked the account of the target financial institution.
  • They're a follower of the financial institution account.
  • The user has posted to Instagram and used a related hashtag.

It isn't often that Instagram users are picked at random for this scam. The focus is targeted so the scammer has high odds that the user will be interested.

How Do I Avoid Getting Involved in This Scam?

While it's difficult to avoid being targeted for the Instagram money scam, it's easy to avoid getting involved.

  • If a financial offer seems too good to be true, it usually is. Don't take part.
  • If a financial institution does have a loophole where you could multiply your money, it's illegal. Avoid getting involved in criminal activity.
  • Don't respond to any stranger messages on Instagram unless you can confirm it's a real person and you have a real need to respond.
  • If you ever do make investments, do so outside of Instagram and on reputable investment websites.

I'm Already a Victim. What Should I Do?

If you've already sent money to one of these scam artists, there are a few things you should do immediately, depending on the way that you sent the money.

  1. Immediately file a fraud alert with the financial institution you sent money through. Western Union has a fraud complaint form you can file on its website; PayPal has a Resolution Center where you can report a PayPal account. Most major banks have fraud centers where you can report the scammer. Call your bank to learn more.

    Screenshot of Western Union fraud complaint form
  2. If you're in the United States, file a complaint with the FBI's Internet Crime Complaint Center (IC3). Just select File a Complaint on the web page and fill out the complaint form.

    Screenshot of FBI Internet Crime Complaint Center
  3. If you're in the United Kingdom, you can report the fraud at the National Fraud & Cyber Crime Reporting Centre known as ActionFraud.

    Screenshot of the UK ActionFraud website
  4. Finally, make sure to report the scammer's profile to Instagram so the fraud can't happen to anyone else. To do this, select the three dots to the right of the scammer's post, and select Report Inappropriate. To report an individual account, right-click the three red dots and select Report User.

    Screenshot of reporting a scammer on Instagram
  5. After you finish filing all the fraud reports, work with your financial institution to either prevent the payment from processing or receive a reimbursement, if possible.

How Do I Avoid Being Targeted for the Instagram Money Scam?

This is one of the hardest scams to avoid being targeted for because scammers look at everyone who has followed or liked a large company or brand account. You can't hide your account from showing up, and you can't prevent people from messaging you.

There are a few precautions you can take if you're serious about reducing the odds of being contacted by a scammer:

  • If possible, avoid liking or following any of the big brands or companies. Otherwise, at least avoid liking or following the accounts of financial institutions.
  • If you are contacted by a stranger about a financial opportunity, ignore the message.
  • Never provide your bank account or credit card information to a stranger on Instagram.
  • Never wire money or send Paypal payments to a stranger on Instagram.
  • Avoid making posts on Instagram stating that you're looking for ways to make money.

This type of scam is easily avoidable by being cautious when you come across financial opportunities on Instagram. Avoid clicking any suspicious links in these Instagram posts and avoid communicating with any of the scammers via Instagram messages.

If you want to invest in one of these ads, fully research the person or company making the claim through the Better Business Bureau to identify if you're dealing with a scam website. Make sure the person or company you're investing with has a real address and valid contact information. And most importantly, always remember that if an offer sounds too good to be true, it usually is.