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Investment scam

Globally people lose more money to investment scams than any other type. These scams can be hard to spot.

Don’t lose your life savings to a money-making opportunity that’s too good to be true.

Scammers use convincing marketing and new technology to make their investment sound too good to miss. They promise you big payouts with little or no risk. They often use pressure tactics to get you to act fast, so they can steal your money.

Steps you can take to protect yourself

Always stop, think, and check before you act. These scams will often pressure you to act quickly. Don’t let them rush you into a bad decision.

Get independent legal advice, or financial advice from a financial advisor registered with to respective regulatory body.

Do your due diligence to make sure you know who you’re dealing with. Make sure the company or website is not named on the International Organization of Securities Commission’s (IOSCO) investor alerts.

Other things you should check:

      • that the person you are dealing with works for the organisation they say they do, using contact details you found yourself

      • the person trying to sell you a financial or investment product, or who is giving you financial advice, has an Regulators license

      • the address and contact details for the company are correct on public listed directories

      • the company’s share listing on the stock exchange. If the offer to buy the shares is well below the market value shown – it’s a scam. If you are told the shares are being released pre – initial public offering (IPO) be even more cautious

      • when the domain name was registered. A new website for an existing company is a red flag

    Common investment scam

    Crypto Scam

    Scammers use crypto-asset (virtual currency) investments, like Bitcoin or Ether, because they are hard to track.

    Crypto is a very high risk and volatile investment. The value can go up or down quickly and there are no guaranteed returns.

    If you lose your money to a crypto scam, Report to us quickly as we have deviced advanced tools that can trace the blockchain transactions, and initate asset seizure and recovery.

    Ponzi Scheme

    onzi schemes are investment scams that use money collected from new investors to pay old investors. There is no real investment.

    Imposter Bond

    The scammer pretends to be from a financial service company or a bank offering low risk investment products such as government bonds and fixed term loans. They demonstrate specialised financial knowledge, provide convincing documents, websites, and information, which are all fake.

    Fake initial public offering Scam

    An initial public offering (IPO) involves a company raising capital by offering shares to the public for the first time. Scammers impersonate Australian companies, including banks, to promote offers that coincide with legitimate company listings. They don’t have any association with the companies.

    Superannuation

    Superannuation scams offer early access to your super fund, often through a self-managed super fund or for a fee. The scammer may pose as a financial adviser.

    Romance Baiting

    The scammer uses a fake dating profile on social media, a dating website or app.

    The scammer then moves the chat to a different, ‘more private’ chat site such as WhatsApp, Google Hangouts or WeChat.

    Scammers say things to gain your trust before they tell you about an investment opportunity. Often, they say they have made a lot of money very quickly. They urge you to invest a small amount and you may see a quick return. The scammer then encourages you to invest larger amounts.

    If you stop investing or want to withdraw your money, the scammer will stop contacting you. The investment platform will no longer be available, or you may be told the investment failed.

    Celebrity Endorsement scam

    Scammers use the image, name and personal characteristics of famous people without their permission, to get you to invest. 

    The celebrities’ image is used in two ways:

    1. An advert on social media or YouTube or,
    2. A fake news story that appears to be from a well-known news company.

    These will typically link to a scam website and are often used to advertise scam crypto investments.

    Gambling and sport betting

    These scams are a form of gambling made to look like real investments. Most do not work as promised and buyers cannot get their money back. There are different versions of this scam.

    Computer prediction software

    The scammer sells you a software program to predict sporting results promising high returns.

    The information used to make the predictions can be found in the betting pages of your local newspaper at very little cost.

    Betting syndicates

    The scammer asks you to become a member of a betting syndicate for a joining fee (often over $15 000). You are required to make ongoing deposits to maintain the balance of the account.

    The scammer tells you that they will use funds in the account to place bets on behalf of the syndicate. You, and other syndicate members’ are promised a percentage of the profits, but the scammer simply steals your money.

    Sports investment

    These scams are promoted as business opportunities or investments at trade fairs, shows or via the internet. 

    The scammer uses technical or financial terms such as ‘sports arbitrage’,’ sports betting’, ‘sports wagering’, ‘sports tipping’ or ‘sports trading’ to make these scams look like legitimate investments.