According to the Australian Competition and Consumer Commission (ACCC), Australians lost over $328 million from investment scams in 2020. This made up more than a third of total losses from scams, however, these numbers could be significantly higher as many cases go unreported. The following information may assist you in identifying the signs of an investment scam.
Investment scams can occur when someone contacts you unexpectedly either by phone, email or social media offering you financial advice and a once in a lifetime opportunity to invest.
Cold call – A scammer claiming to be a stock broker or portfolio manager calls you offering financial or investment advice. The scammer may sound legitimate and create a sense of urgency, prompting you to make a quick decision.
Social media – Scammers may use social media to message you, advertise or send ‘friend’ requests. Often they may pose as someone you know or are connected to. If you friend them, they may send you offers to invest and make quick money.
Advertisements – Investment fraud scammers often appear as ‘pop ups’ on the internet appearing as a legitimate website, some of which are endorsed by public figures. Scammers can also issue fake online press releases for outstanding corporate performance. They have the ability to provide logins to view fake investment balances and offers of high return with little or no risk.
People from all walks of life can become victims if the timing is right and the story is convincing. It is important to become educated, do some research if unsure and look out for anything that may look suspicious.
If you or someone you know think you might have been scammed, contact your financial institution immediately. We also encourage you to report scams to the ACCC via the Report a scam page.