Tainted Supplements, Troubled Transactions: Social Commerce Dangers

August 18, 2025

Rochelle Blease is the president of G2 Risk Solutions, a global risk management firm.

Promising easy weight loss or an enhanced appearance, influencers are driving more traffic to nutraceutical websites that sell unapproved products. The strategy works; 77% of consumers prefer influencer content over ads. In a 2025 survey, 20% of U.S. adultsreported buying based on influencer recommendations, and 43% follow at least one content creator.

Beyond consumers, payment providers are also at risk. When health is at stake, regulators and card networks scrutinize sellers and the financial services that enable them.

Payment providers often lack visibility into noncompliant merchant activity. That’s because traditional due diligence wasn’t built for today’s high-velocity social commerce, where shoppable posts and affiliate links blur the line between content and commerce. In the U.S. alone, social commerce sales are projected to exceed $100 billion in 2026.

Invisible Ingredients

Social media fosters diet and beauty trends that often promote unsafe products. In 2024, for example, the FDA issued warnings about online sales of tainted weight loss supplements. Marketed as the Mexican fruit “tejocote,” the products were found by the FDA to contain toxic yellow oleander, which can cause severe or fatal health effects. 

Tainted cosmetics are another area of concern. Through compelling visual content of before-and-after skin transformations, consumers can be guided to purchase potentially dangerous skincare. In recent years, regulators have uncovered products marketed as over-the-counter “skin lighteners” that contain undisclosed ingredients, including hydroquinone and mercury. Consumers exposed to these products have experienced mercury poisoning, rashes and permanent skin discoloration.

These examples represent a fraction of the murky world of social commerce, where every regulatory alert is a red flag that payment providers can’t ignore.

Payment Providers’ Responsibility

Viral trends and influencer endorsements introduce a highly dynamic risk vector into the payments industry. Payment providers are expected to vet and monitor their merchants for risky behaviors, including the sale of tainted supplements. In the view of card networks and regulators, facilitating payments ultimately helps dangerous merchants—even if the provider isn’t aware of a merchant’s illicit actions.

Obtaining such awareness can be tricky. Merchants that look benign may be selling violative or illegal products that pose health dangers. Some merchants go to great lengths to hide the true nature of their businesses, using fake shell sites to pass due diligence checks. Others may leave vital information off their payment account applications, such as affiliated social commerce sites, sales pages or merchant category codes that would place them in high-risk categories.

A single viral post can trigger thousands of transactions, making visibility gaps costly for payment providers. Card networks can impose significant fines for enabling illicit transactions. What’s more, card network action often prompts additional scrutiny from regulators.

Managing Merchant Risk

To mitigate risks, payment providers need a responsive framework that includes deeper onboarding intelligence and continuous monitoring. A programmatic, data-driven approach can surface red flags.

Here are five actionable steps payment providers should take:

1. Go beyond static onboarding.

Traditional underwriting is not enough in a market where a merchant can shift product lines, ownership or marketing tactics in a matter of hours. Acquiring banks should expand initial due diligence to include beneficial ownership verification, adverse media screening and website traffic analysis.

More importantly, they should adopt a scheduled refresh process to keep that data current. Doing so can help spot risk indicators before they turn into enforcement actions. In an industry where reputational fallout travels faster than compliance updates, reactive vetting is no longer defensible.

2. Use real-time digital intelligence.

Once a merchant is onboarded, too many acquirers rely solely on transaction data to spot fraud. That’s no longer enough. The front end of many risky supplement sellers is a slick landing page optimized for conversion—one that may change copy, imagery and claims overnight.

By incorporating automated web-crawling, payment providers can quickly flag risky language like “FDA-approved” or “clinically proven.” When a supplement merchant updates its marketing to include aggressive health claims, it’s often a sign of accelerating risk.

3. Integrate regulatory and enforcement data.

Banks are not labs and shouldn’t try to act like them. However, they can make powerful use of existing regulatory data. Government agencies issue a steady stream of alerts, many of which are specific to product brands, ingredients and merchant URLs.

By ingesting and cross-referencing this data against their own merchant portfolio, payment providers can quickly flag when a merchant is under regulatory scrutiny. It’s a simple but often overlooked method for maintaining awareness of known bad actors—one that doesn’t require waiting for a spike in chargebacks to signal trouble.

4. Treat transaction data as a risk early warning system.

Payment providers have one data stream that regulators and card networks don’t: real-time transaction trends. Used correctly, that stream becomes a powerful source of early detection.

Unusual spikes in high-ticket transactions, increases in cross-border routing or refund patterns that don’t match the merchant’s stated model are signs that something may be amiss. Sophisticated acquirers are now using AI-assisted tools to benchmark merchants against known fraud patterns, surfacing anomalies before they become liabilities.

5. Establish a remediation framework.

When violations do occur—whether flagged internally or raised by a network—speed and structure matter. Leading risk teams are developing standardized systems that capture digital evidence (like screenshots, product descriptions and influencer endorsements) and route that data through tiered workflows.

Depending on the severity of the issue, these may trigger outreach for clarification, a corrective action plan or merchant termination. Crucially, this approach generates an audit trail that demonstrates to networks or regulators that the bank took reasonable and timely steps. In today’s climate, that paper trail can mean the difference between resolving an issue and becoming part of an enforcement action.

The Path Forward: Coordinated Intelligence, Not Just Controls

Modern risk management is no longer rooted in static compliance. It’s driven by real-time intelligence strategies that surface red flags quickly. The opportunity lies in integration: Connecting onboarding, monitoring, regulatory data and transaction signals into a unified view of merchant behavior.