What is it?
You’re convinced to move your money into a fictitious fund or to pay for what later turns out to be a fake investment which promised a high return.
You may be targeted by cold callers or presented with fake investment opportunities promoted on search engines and social media pressuring you to act quickly. It might seem genuine because of the use of celebrity endorsements or testimonies from people who’ve allegedly received large profits but in reality, these are fake.
Criminals often set up cloned websites purporting to be legitimate investment firms and may even send out paperwork with official branding to add a layer of credibility to their scams. You may also receive an initial payment of your “returns” to convince you to invest larger sums of money.
Criminals spend hours researching you for their scams and may provide you with details of previous investments and shares you hold.
These scams include convincing you to invest in markets such as gold, property, carbon, cryptocurrencies such as Bitcoin or wine.
How to spot an investment scam
- You’re contacted out of the blue by phone, email or social media about an investment opportunity
- You see ads within your social media feeds, sometimes celebrity endorsed, offering high returns on investment
- You’re pressurised into making a decision with no time to consider the investment
- You’re offered a high return on your investment with apparently little or no risk
- You’re told the investment opportunity is exclusive to you
Examples of investment scams
Arun saw a ‘celebrity endorsed’ social media post advertising the promise of big returns on Bitcoin. He contacted the company and following a phone call with a “trader’ was convinced to make a payment of £300. After logging into his trading account on the website, he saw his investment increase. Arun continued to invest more money following pressure from another “trader” from the company and was persuaded to take out a loan sourced by the criminal. Arun only realised it was a scam when he was unable to access his account to withdraw his money or contact the company.
Bonds and Shares
Maisy received a cold call from a ‘stockbroker’ at an investment firm, offering her shares in a company about to be listed on the major stock exchange. Maisy was told she would receive a huge return and was urged to invest before the company ‘goes public’. She was given the ‘firm registration number’ and addresses of individuals ‘authorised’ by a regulator convincing her it was legitimate. Maisy proceeded to buy the shares. She realised she had been scammed when she was unable to contact the investment firm any longer and couldn’t get her money back.