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Selling fake friends doesn't pay.

New York Attorney General Letitia James announced a precedent-setting settlement Wednesday with Devumi, a company that found itself in hot water after The New York Times reported it sold millions of fake likes, retweets and followers on social media.

These millions of bot accounts ran unchecked across Twitter, YouTube, LinkedIn, SoundCloud and Pinterest. Some fake accounts stole real people's photos on social media, the attorney general's office said. The company sold fraudulent social media engagement to celebrities, musicians and athletes, it added. The practice makes opinions and people appear more popular than they actually are.

This is the first time a law enforcement agency has found that selling fake social media engagement and using stolen identities is illegal. Devumi, and its former CEO, German Calas Jr., couldn't be reached for comment.

"Bots and other fake accounts have been running rampant on social media platforms, often stealing real people's identities to carry out fraud," James said in a statement. "With this settlement, we are sending a clear message that anyone profiting off of deception and impersonation is breaking the law and will be held accountable."

A Twitter spokesperson referred to the company's statement when Devumi's tactics were first revealed in 2018: "The tactics used by Devumi on our platform and others as described by today's NYT article violate our policies and are unacceptable to us. We are working to stop them and any companies like them," the company said in a tweet.

Fake accounts on social media aren't just a problem with the law -- tech giants like Facebook and Twitter also have issues dealing with fraud. Nation-states have used similar strategies as Devumi to spread disinformation and sow political chaos. During Facebook's earnings call on Wednesday, the company noted that fake accounts could make up 5 percent of its monthly active users -- about 116 million accounts.

But fake accounts alone aren't the problem: it's using them to inflate influence online, as the attorney general's investigation found Devumi did. Faking social media engagement, the attorney general's office found, could affect what followers choose to buy and who advertisers choose to sponsor.

Some customers also believed they were paying for real followers, as Devumi sold about 250,000 social media engagements between 2015 and 2017. The company made about $15 million during those two years, and it was growing quickly.

Up to 500,000 followers on Twitter could cost as low as $3,997, while Devumi sold likes and retweets in packages up to $228 a year.

Devumi ended its operations in September, with a massive decline in sales. Under the settlement's terms, the company isn't allowed to repeat the same behavior.

The company will also have to pay New York $50,000 for costs and fees involved in the attorney general's investigation.



First published Jan. 31, 10:21 a.m. PT.

Update, 12:15 p.m.: Adds statement from Twitter.

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