HSBC warns customers to be alert to investment scams

According to the National Anti-Scam Centre, investment scams are still the leading type of scams, with around $135 million¹ reported losses so far this year.

Matt Hannan, Head of Fraud Management at HSBC Australia, said that often criminals cold call or message with investment opportunities offering guaranteed or very high returns. Additionally, criminals are also known to set-up spoof websites, fake social media profiles and fake companies that have similar (or the same) names as genuine investment organisations.

“Scammers can produce convincing marketing materials and might refer to current news to make the opportunity seem realistic. If it seems too good to be true, it probably is. If in doubt, do your research. Use well-known and reputable sources before you take action and check that they’re verified,” Mr Hannan said.

Here are some things to look out for that may be signs of an investment scam:

Short term returns as an incentive for larger investments

Fraudsters have been known to run scams in which they often provide initial short term returns which are then used to convince victims to invest more. After sending larger payments consumers can suffer even greater losses.

Receiving a call from a “financial adviser”

You may receive a phone call from someone pretending to be a financial adviser who claims to have a time limited investment offer with high returns and low risk, that must be taken up immediately. They may also tell you that they have inside information about a product or initial public offering (IPO) or discounts for early investors, which often turn out to be false information.

Celebrity endorsements for an investment

Don’t fall for fake endorsements - criminals can sometimes impersonate famous people on social media or messaging apps to make their offer seem more real and appealing.

Cryptocurrency scams

The boom of cryptocurrencies in recent years has meant scammers are increasingly using the currency as part of fake investment opportunities. Scammers will ask you to sign up with a cryptocurrency provider with your identity documents to open a trading account or online wallet. Never let anyone set up a cryptocurrency wallet, upload ID documents or manage investments for you.

Always seek trusted and independent advice before undertaking significant investments.

Remember, some scams can be hard to spot, and anyone could be targeted by a scammer. If you think you’re the victim of a scam, your details are compromised or you’re worried about fraud, get in touch with your bank immediately.