ScamSmart - are you at risk of investment fraud?

Thousands of people in the UK fall victim to investment and online scams every year. As well as the financial cost, the scam can cause great emotional distress to victims.

The scam usually begins with unsolicited contact by phone or seeing online/social media advertising. In 2017, for the first time, ‘online’ overtook ‘phone’ as the most common contact method selected on our Warning List tool.

The actual scams will vary, but they pretty much all work in the same way; using high pressure selling and persuasion techniques that are effective at influencing behaviour.

Most at risk are those aged 55 or over and already own investments.

However, on social media, Under 25s are six times more likely to trust an offer made to them than their elder counterparts.


How to be a ScamSmart investor

1. Reject any unsolicited contact about investment opportunities.

There are ways that fraudsters can pretend they aren’t calling you out of the blue. They may, for example, refer to a brochure or an email that they have sent you. That’s why it’s important you know the other tell-tale signs that suggest the investment opportunity is likely to be very risky or a scam.

Investment fraudsters may do one or more of the following:

  • apply pressure on you to invest in a time-limited offer, offer you a bonus or discount if you invest before a set date, or say that the opportunity is only available for a short period of time
  • downplay the risks to your money, or use legal jargon to suggest the investment is very safe
  • promise tempting returns that sound too good to be true, offering much better interest rates than those offered elsewhere
  • call you repeatedly and stay on the phone a long time
  • say that they are only making the offer available to you, or even ask you to not tell anyone else about the opportunity

If you ever receive a call offering you the investment of a life time, just put the phone down.

Go by the rule that if it sounds too good to be true, then it probably is.

2. Check the FCA Warning List

Do your own checks before investing; check the Financial Conduct Authority Warning List and the Financial Services Register to see if those that are asking for your money are the real deal.

The FCA Warning List is a list of firms and individuals we know are operating without our authorisation. If you would like to report a scam or an unauthorised firm, please fill in the details here.

3. Get impartial advice

Think about getting impartial financial advice before you hand over any money. Seek advice from someone unconnected to the firm that has approached you.

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