The UK’s Financial Conduct Authority (FCA) and Action Fraud have revealed more than £27m was lost to crypto and forex investment scams during 2018/19.
Additionally, the number of investment scams reports more than tripled last year to over 1,800, and on average, victims were conned out of £14,600 from these scams.
These scams are often promoted through social media as a ‘get rich quick’ online trading platform. Posts typically come with fake celebrity endorsements and images of luxury items such as watches and cars. The posts link through to a professional-looking website encouraging consumers to invest.
The victims are deceived to think their first investment makes a profit and are then encouraged to invest more money or introduce family and friends in a bid of making bigger profits. After time, the returns dry up and the customer’s account is closed with no further contact from the scammer.
In response, the FCA’s ScamSmart campaign will run adverts to raise awareness of online trading scams. These will be pushed out on social media. This initiative is supported by the City of London Police.
The FCA is also asking investors to check its dedicated website for tips on identifying investment fraud.
The four main points from the program is to not assume it’s real, avoid uninvited investment offers, check they are authorised by the financial services register, and to report any incident of fraud.
Action Fraud director Pauline Smith said, “These figures are startling and provide a stark warning that people need to be wary of fake investments on online trading platforms. It’s vital that people carry out the necessary checks to ensure that an investment they’re considering is legitimate. Action Fraud is pleased to be partnering with the FCA to raise awareness of online trading scams, and we hope it will help prevent more people falling victim. Remember, if you think you have been a victim, contact Action Fraud.”
Action Fraud is the UK’s national fraud and cyber crime reporting centre.
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