Sarah Sinden
Manager, Economic Crime, Customer Education Strategy, UK Finance
Criminals are experts at impersonating people, organisations and the police. They spend hours researching you for their scams. Therefore, everyone needs to be on the lookout.
Throughout 2020 we’ve seen a significant rise in investment scams as fraudsters have preyed on people’s financial insecurities.
Often promoted on search engines and social media, criminals use online adverts to trick people into parting with their money. These offer investment opportunities that claim to guarantee stronger rates of return and minimal risk.
Anyone who clicks through will be asked to fill in an online form to register their interest, before receiving a call from someone impersonating a genuine firm or broker. Criminals will also sometimes send out professional-looking documentation to make the scam appear more convincing.
How to spot an investment scam
It’s understandable how these schemes can reel people in, but it’s important to remember that if it sounds too good to be true, it usually is.
The Take Five to Stop Fraud campaign has some simple advice to stay safe:
What to look out for:
- Ads on your social media feeds, sometimes with a ‘celebrity endorsement’, sometimes offering higher than average returns on investments with apparently little or no risk.
- Out of the blue phone calls and emails about an investment opportunity.
- Investment opportunities that are apparently exclusive to you and only you.
- Being pressurised into making a decision with no time to think.
Helpful advice:
- You can check if an investment or pension opportunity you’ve been offered could potentially be a scam by taking the FCA’s ScamSmart test.
- Check the Financial Conduct Authority’s (FCA) register for regulated firms, individuals and bodies at fca.org.uk. Ensure you only use the contact details listed on the register to confirm you’re dealing with the genuine firm.
- Most cryptocurrencies aren’t regulated by the FCA which means they’re not protected by the UK’s Financial Services Compensation Scheme. It’s important that you do your research and proceed with extreme caution before making any investments.
Report scam ads appearing in paid-for space online by visiting the Advertising Standard Authority’s website where you can complete their quick reporting form.