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Anyone can fall victim to a scam. Australians are losing more money to investment scams than any other type of scam. Investment scams have the potential to result in significant losses. These scams can be sophisticated with scammers using convincing websites and seemingly legitimate credentials to scam you out of your money.
What is an investment scam?
An investment scam can involve you being contacted by someone you have never met via phone, email, or social media offering you the chance to invest in a 'once-in-a-lifetime’, high return/low risk opportunity.
In other cases, you may receive contact after clicking on online ‘advertisements’ relating or after providing your contact information to online enquiry forms with companies passing themselves off financial services providers. Offers might relate to shares, real estate, term deposits, bonds, options or foreign currency trading, crypto currencies (e.g. Bitcoin), betting syndicates, and gambling or software where scammers even seek to sell you foolproof results prediction software.
Investment scammers impersonate bankers, stockbrokers, financial planners, and other investment professionals. They will appear to be knowledgeable and may direct you to legitimate looking websites or provide fake investment prospectuses.
Scammers sometimes create fake online investment portals for you to “monitor” the status of your investment and they may even pay out “returns” on initial investments to convince you that the investment is legitimate, to encourage you to invest more.
How to spot an investment scam and ways you can protect yourself
Red flags that you might be dealing with an investment scam
- Investment opportunities that are too good to be true - offering you access to invest in a “once-in-a-lifetime” scheme with little to no risk.
- Celebrity testimonials promising big returns.
- Rates and returns significantly above those that you can access yourself through reputable financial institutions.
- Advisors that ask for remote access to your devices to complete trades on your behalf.
- Use of pressure tactics and a sense of urgency that rush you to act.
Staying safe
- STOP, THINK AND CHECK! Be suspicious of any investment that seems too good to be true; it usually is.
- Do not be pressured into a quick decision about an investment of your money.
- Get independent advice from a financial advisor registered with ASIC.
- Do your research
- Check ASIC’s MoneySmart online “Investor Alert list” for companies you should not deal with. If the company that contacted you is on the list, cease communication with them immediately.
- Check reviews using the investment name plus the word ‘scam.’
- Check if the address and contact details for the company are listed publicly across various sources.
- Find contact details for the person you are dealing with independently – don’t rely on what they’ve given you.
- Anyone offering to arrange an investment product or to give you financial advice must have an Australian financial services licence. You can check the Financial Advisers Register on ASIC’s MoneySmart website.
- Do not provide your contact details to unsolicited callers or emails. Hang up or delete the email.
What if you think you may have been scammed?
If you suspect you’ve been involved in an investment scam, don't be embarrassed; fraudsters are clever and use convincing tactics to manipulate people.
Act quickly and call us with concerns as soon as possible on 133 462 or visit your local branch.
Scam and Fraud Resources
To learn more about scams, how to spot them and how to avoid them visit www.imb.com.au/security.
Other useful sources of information are the ACCC’s ScamWatch page at www.scamwatch.gov.au and ASIC’s MoneySmart at www.moneysmart.gov.au
