What you need to know about Twitter’s New Financial Scam Policy


Twitter has introduced a new Financial Scam Policy (“Policy”) under its platform manipulation policy, to tackle financial frauds and money flipping schemes, advertised or propagated on its platform.

The overview of the Policy clearly states that Twitter’s service is not to be used to amplify or suppress information to deceive or manipulate users. Anyone who notices any tweet, which they are suspicious of operating financial scam, they may report the Tweet and Twitter will take necessary action in the manner as provided below. The Policy explicitly prohibits following tactics that are commonly used in fraudulent schemes:

·     Relationship/Trust-building scams – In such scams, people deceive others by operating a fake account or posing as a celebrity or as an organisation, to seek personal financial information or money from users. For example, as it is known that parody accounts are allowed on Twitter as long as they follow the Parody, newsfeed, commentary, and fan account policy of Twitter. However, if such parody account starts asking for financial information or money from other users, they will fall under perpetrating relationship scams.

·      Money Flipping Schemes – Under these schemes, people are promised a big sum of amount if they pay an initial, smaller payment via a wire transfer or debit card. For example, someone might tweet saying if you send, let’s say, a minimum of INR 10,000 to a particular bank account, you will receive five times that amount within 30 days. Since, a lot of people look to make quick money, they send more money, to get larger returns. This is why such schemes attract a larger mass and cause substantial financial losses.

·   Fraudulent Discounts – We often come across posts/tweets claiming to offer huge discounts on premier products. Most often than not, the operators of such twitter handles may have obtained credit cards or financial information of other people fraudulently and fulfil the offer on the product through such credit cards or financial information obtained fraudulently.

·     Phishing Scams – Phishing Scams are done by people who pose themselves as employees or agents of banks or other financial institution and ask financial information from others. Since, they deceive others by claiming they are from the bank itself, people generally fall prey to phishing scams. Let’s consider this hypothetical situation, person A claims to be from some bank and asks for financial information including but not limited to bank account number, IFSC code from other users in case they have faced any transaction issue. Once they receive such information, they initiate a new transaction and send a link to the aggrieved user’s smartphone. Then the user is made to believe that clicking on that link will solve their issue, but in reality, it just initiates a new transaction and dupes the user. This is how phishing scams are done through social media.

What is not a financial scam?

However, Twitter has clarified in the Policy that any claims relating to sale of goods, or any ongoing financial disputes related to refunds from brands and individuals and any complaints of poor-quality goods received, shall not be considered as a financial scam.

What happens if there is a violation of this Policy?

(1)            In case of an isolated incident or a first-time offence, then tweets in question may be deleted by Twitter.

(2)            Twitter may also temporarily lock the accounts responsible for such tweets.

(3)      In case of any severe violations, such accounts will be permanently suspended. Twitter has clarified in the Policy that severe violations means operating accounts where majority of behaviour is in violation of the Policy and creating accounts to replace an already suspended account.

(4)       Furthermore, if Twitter identifies suspicious levels of activity from any account, such accounts will be locked and asked to provide additional information or to solve a reCAPTCHA.

(5)        Twitter has also stated that if it believes that any URLs are harmful, they might blacklist it or provide warnings about such URLs.

Quick View

Unfortunately, financial scams are pretty common in India. As per Experian Identity and Fraud Report 2019 (Asia-Pacific Region) (“Report”), 65% of the surveyed businesses in India suffered losses due to online fraud. The Report also suggested that out of all the fraud cases in India, 28% cases were related to identity theft and 25% cases were related to fraud contact information. There has also been a phenomenal increase in penetration of smartphones and internet services in recent years. Consequently, the number of people who are at risk of being defrauded has also increased correspondingly. This problem is also compounded by factors such as financial and technological illiteracy amongst a large number of smartphone and internet users in India.

Furthermore, with very few states having strong jurisdictional cyber-crime police stations to tackle cyber-crimes, internet users in India will be stretched to find appropriate recourse in the event of them being defrauded while transacting online.

This new Policy of Twitter is indeed a welcome, proactive measure in tackling financial scams. Given Twitter’s reach in India, what this Policy can effectively do is to afford atleast those 34.4 million users an additional safeguard if they were to undertake financial transactions with other users of Twitter. It will be interesting to watch this space for more action in the days ahead, particularly when users start to make complaints to Twitter, if and when they have been fraudulently deceived by other Twitter users. The data that could be thrown up by the number of complaints made in each year, and the action taken by Twitter in each such case, could well be instructive for law enforcement agencies to increase their monitoring of online financial transactions across all social media platforms in the days ahead.

One would hope that all other social media platforms also follow Twitter’s lead and introduce similar Financial Scams Policies, so as to increase the confidence of users.

Disclaimer: This post has been prepared for informational purposes only. The information/or observations contained in this post does not constitute legal advice and should not be acted upon in any specific situation without seeking proper legal advice from a practicing attorney.