Investment scams are on the rise. Many of these scams start with a cold call, an online advert or a message on social media. Scam websites can also show up when someone is searching for investment opportunities online and will often have an online form to capture contact details and other personal information.
This will lead to contact from a scammer claiming to be a broker, account manager or financial advisor who is eager to help you invest. They may claim to have made large profits investing in the scheme themselves. Later, when the victim tries to withdraw their investment, they find they can’t, and may even be asked to pay more to access funds.
These scams can result in huge financial loss and in many cases the funds are unrecoverable. They can also be hard to spot. Scammers often sound professional. Sometimes they will claim the investment is low risk and promise high returns. But often, returns or interest rates promised may be only slightly better than market rates.
They also create legitimate looking fake websites, investment or prospectus documents or use celebrities' names and pictures to endorse their schemes. They may even ask for ID and address documents, pretending to collect this information for legal reasons.
The types of investments offered vary and could include cryptocurrency, term deposits, shares, real estate, bonds, options, foreign currency trading, betting syndicates, prediction software or investment apps.
Scams involving cryptocurrency and fake products (like term deposits) from scammers pretending to be from legitimate financial service providers (such as banks) are common.