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Australians losing out to investment scams grow (and how to spot one)

Scammers are about, and they’re targeting your wallet with attacks aplenty, focusing on investment and dating scams most, it seems.

Aussies are still being hit hard by scams and the news isn’t good, with the February 2021 report from the ACCC’s Scamwatch website reporting over 20,000 reports from Australians and just shy of $21 million lost. That makes for a fairly expensive month, with much of that coming from dating scams and investment scams, even as topical scams related to the coronavirus vaccine start to ramp up.

It’s yet more reason why it’s important to stay aware of what’s going on and to not just simply trust those emails coming in, as scammers look to fleece people with something as simple as an email, a text, or even a fraudulent website.

According to Scamwatch’s data from February, dating and romance scams were popular, causing Australians to lose out in a little over $4 million, while remote access scams — the “NBN is calling” type of scam where a scammer tries to take over your computer and then ransom access back to you — caused losses of close to $2 million alongside identity theft scams.

However while there were other scams that made a dent, too, such as online shopping scams, investment scams were the big moneymaker for criminals targeting Australians last month, with over $8 million lost. That’s a slight fall from the almost $10 million lost to investment scams at the start of the year in January, but it suggests this type of scam could become a big problem for Australians, particularly those unsure what to look out for.

What is an investment scam?

If you know what an investment is and you know what a scam is, you probably have an idea of what an investment scam is. You simply need to marry the two together, and you can imagine what a scammer might be targeting and tempting people with.

“Investment scams aim to get individuals to give away their money in return for a financial investment opportunity such as purchasing shares, funds, leveraged products, cryptocurrency or other high-return schemes,” said Crispin Kerr, Vice President of Proofpoint in Australia and New Zealand.

“In the case investments scams offering shares for example, scammers will typically pose as a stock broker or portfolio manager and claim to have inside knowledge on certain stocks,” he said. “They use persistent sales tactics promising high-returns to pressure people to act quickly or risk losing out.”

It’s a type of scam anyone looking to make money from investments should be weary of, because that person becomes the clear target for scammers. Unfortunately, investment scams can go much deeper than simply promising quick returns, because long-term scams on superannuation are also a possibility.

“Scammers may impersonate a financial advisor or an individual’s super fund and offer early access to their funds for a fee, or drain their funds entirely,” Kerr told Pickr.

“Over the course of the pandemic there has been an increase in the number of investment scams and the amount lost to these types of scams in Australia,” he said.

“These ‘get rich quick’ schemes have been used by scammers to entice people to part way with their money especially during periods of financial hardship, as we’ve seen in the last 12 months.”

How do you stay aware of financial scams?

Every scam has a slightly different approach, but they’ll all typically follow the same approach: promising something that seems intangible.

In the case of the prize scam, it’s often a lucrative prize that’s come out of the blue, with credit card details needed for the shipping of said prize. In the Australia Post scams, it’s a package that has come from nowhere that you didn’t expect, and is clearly not a package.

And with investment scams, it’s the lure and promise of quick returns from someone you’ve never heard of, or even someone purporting to be someone you have.

As with most scams, it’s important to check the email address or website to see if it’s legit, and to contact the company the scam is purporting to be from to find out whether this is legit.

There’s typically no such thing as a “get rich quick scheme”, much like how there’s typically no such thing as a free lunch, so if you’re trusting everything you believe in your inbox or what comes in on your phone, you might want to do a little more research and due diligence to make sure you’re not just giving your money away.

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