According to the Wall Street Journal, the scammers have pretended to be several high rollers on the social media platform. Targets of this identity theft include billionaire hedge-fund manager Bill Ackman, Cathie Wood of ARK Investment Management and New York Mets owner Steve Cohen. Other investment bigwigs such as Peter Lynch of Fidelity Investments and Ray Dalio of Bridgewater Associates have also been tapped by scammers without their consent.
Ackman's Pershing Square Capital Management (PSCM) has found more than 90 different advertisements impersonating him. One promised annual returns of 125 percent, while another promised a 25 percent return in a week. "Hold these three stocks and you'll be a millionaire," the second ad said.
PSCM spokesman Fran McGill said many of the ads remained visible for weeks after the company flagged them to Meta, Facebook's parent company. As soon as one ad was removed, others popped up, he said.
"It's like a game of whack-a-mole," McGill lamented. "It's been a huge problem and all social media companies need to do more to prevent people from being scammed like this."
Even Wood's ARK has spotted thousands of ads that impersonate her, promising a 45 percent gain either in a week or in a month. Some of the victims of the Cathie Wood scam ads were directed to a Facebook page asking about their investment history and then into a series of WhatsApp groups, often moderated by two fictitious people who claimed to be associates of Wood at a separate make-believe company called Red Sea Fortune Investment.
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One victim said a fake assistant, who went by the name Ava Evans, would share pictures of her breakfasts and flowers and ask personal questions as she encouraged her to invest more with each trade.
The company issued an alert about such scams, and its director of operations William Scherer posted a notice on LinkedIn in January that he had been impersonated. "Any WhatsApp messages that may seem to be coming from me are a scam," he wrote at the time. (Related: Online safety: How to avoid common internet scams.)
Several victims speak out
According to the Federal Trade Commission (FTC), reported impostor scam losses tripled to $2.7 billion between 2019 and 2023. Christopher Brown, FTC marketing practices attorney, described the trend as one that is "increasingly prevalent and harmful."
Atlanta construction company owner Peter Bourget was among those victimized by the con. He lost $45,000 when the penny stocks he was told to buy nosedived. He jointed one group last fall after clicking on a Facebook ad featuring Wood, partly due to his disillusionment of conventional banks and stock market advisors.
"They were sophisticated and well-organized, but it's still embarrassing to be taken by any scam," Bourget said, adding that the WhatsApp group messages "all sounded very [legitimate] at first." He continued: "They put a lot of effort into building your confidence. You think it's part of an investment club and they have in-depth market analysis."
He lost half his savings on penny stocks on the Hong Kong exchange but kept in touch with the group leaders because they had promised to cover 80 percent of the losses. When he learned this would require more trades, he declined.
A Meta spokesperson said in a statement addressing the matter: "Scammers use every platform available to them and constantly adapt to evade enforcement. We invest heavily in our trained enforcement and review teams, have specialized detection tools to identify fraudulent activity – including to find celeb-bait– and ban ads that use public figures to try to scam people."
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