If fake news stories can be used to win elections, they can also be used to part gullible people with their hard-earned money.
Over the last few days, hundreds of Indians have been seeing an interesting a news story on their Facebook feed. “Azim Premji Invests $515 million In Tech Startup,” says the headline, which seemingly leads to the CNN Money site. “Famous Indian billionaire – Azim Premji with a cult-like following has invested enormous amount – $515,000,000 ( or 515 million US dollars ) of his personal wealth in a tech startup called RevFeed,” the story begins. “He believes the technology this company has created has the potential to shake the worlds economy more than the industrial revolution ever did.”
Apart from the fact that there are no other outlets reporting on this mega funding round, it turns out that the site isn’t CNN Money at all. Its url is cnm.today, and the logo at the top is cleverly designed to pass off as the CNN logo.
And the story seems to change shape depending on where its readers are — in South Africa, the same story has been going viral, apart from the fact that it’s not Azim Premji who’s invested in the company, but South African serial entrepreneur Vusi Thembekwayo. The text in the story remains the same, but the invested amount decreases to $350 million. Thembekwayo yesterday clarified he’d never invested in RevFeed.
— Vusi Thembekwayo (@VusiThembekwayo) May 25, 2017
And the fake news isn’t limited merely to articles — there’s a whole video from an organization called “South Dakota News” that touts the revolutionary advances made by RevFeed. South Dakota News, as far as we can tell, doesn’t exist, and the Youtube account this video was uploaded on currently has 0 subscribers.
So why would a company go to such lengths to show that it is a legitimate and successful business? RevFeed says it’s developed an algorithm through which it can predict stock prices using social media cues. So for instance, when United Airlines recently offloaded a passenger off its plane, there was an immediate social media uproar which led its stock to fall. RevFeed claims it predicted the fall, and made “$15,922,551.98” by shorting the stock.
Since it’s presumably feeling generous, RevFeed says it wants to share its algorithm with common people, and let them earn money in the process. And since it’s feeling especially generous, it also claims new users get a $250 bonus they can use to trade. “RevFeed is 87% accurate with its predictions and guarantees at least $1,492 profits for its users every day,” its site boasts.
While such proclamations would be immediately illegal in India — entities can’t claim “guaranteed returns” from the stock markets, which is why every mutual funds ad must have the long disclaimer at the end — RevFeed doesn’t even provide the $250 upfront bonus. Users are required to refer 10 friends to be eligible, and then forced to pay money online to be able to trade.
RevFeed’s entire model sounds very, very dubious, and after some online outrage, it appears to have now disassociated itself with the fake news sites, calling itself the “victim of this disloyal campaign done by some of our affiliates.” But regardless of the model RevFeed employs — its site has several red flags that are common to online get rich quick scams — what’s probably more concerning is how Facebook and other social media have allowed the hoax to spread. A small Facebook page with 200 odd fans was able to publish a completely fabricated news story, sponsor it , and quickly reach a huge audience.
Facebook has already been under the scanner for its role in the US Presidential election, during which several fake news sites had used its platform to shape public opinion. The company had announced it was taking steps to clamp down on fake news, but if people are able to sponsor a completely fake story on the platform, it shows that its efforts aren’t quite working as desired.
Meanwhile, Azim Premji hasn’t invested $515 million into any startup. And if a stock tip seems too good to be true, it probably is.