Ways To Spot Investment Scam Warning Signs

The online investment fraudsters make cold calls and contact the buyers via email, post or seminar exhibitions. The schemes are advertised online, and the safest method to avoid such frauds is to ignore all the messages that advertise investment deals online. 

In addition, you can register to the Mailing Preference Service or Telephone Preference Service to filter cold calls and letters you receive from unidentified sources.

The callers selling the scheme may send you brochures, and they may refer to the brochure they send to you by post or email when they call. It can help you spot a warning. 

In short, 

• Avoid unexpected calls from contacts coming through online sources like social media, email, word of mouth, exhibitions or seminars.

• The scammers offer a limited-time deal and tell you about the deadline when you will lose the opportunity.

• They share fake reviews of other customers and claim the previous clients earned a lot through such deals. 

• They may offer unrealistic returns through tempting projects that may appear too good to be true. 

• They claim fake authority through websites or say the government or legal agencies authorise them.

• They may ask you to download software from a given source to download the software and fill in personal details, but such software may give them access to your bank account and other details.

Guidelines To Examine An Offer

• Always invest in FCA-backed organisations.

• Seek information on the FSR and look for the FRN number of the firm at authorised websites. 

• Call the authorities to know more about such deals and also about the organisation.

• Make sure not to invest through a clone firm that resembles a reliable authorised firm. Check all the FCA warning lists and look for the firm's contact number in the FCA lists. 

• Get impartial advice from a government agency or financial adviser to make sure you deal with regulated agencies.

• If you find anything suspicious, report it to the local law enforcement agency or call the consumer helpline. 

• Always be cautious of future scams. 

In 2020, the FCA issued over 1200 consumer warnings about social media adverts, where the scams were fake, and unregulated firms were selling unauthorised investments. The latest warning lists provide the banks with a list of customers and victims to help the lenders avoid fund transfer if criminals initiate it. 

Internet-based financial scams are not as common as traditional banking frauds, but the tricksters use tactics to get passwords of the banks' customers to transfer money. The FCA also issued a guideline to Google to publish the regulatory warnings. It wants the social media sites to make some obligatory checks on the posted adverts and messages associated with investments.  

Customers from banks that offer online platforms like Monzo and UK banks HSBC, Starling and Barclays have been blocked from transferring funds into accounts for cryptocurrency investment like Binance and SwissBorg (according to a report of the Britains Telegraph newspaper).   

Such steps have been taken to protect customers from buying cryptocurrencies as the clients associated with these deals have reported high fraud rates.