23 September 2021
3 min read
Investing your money can be an exciting and profitable prospect, but if a low risk, high reward opportunity is being advertised think very carefully and do your own research as it is most likely a scam. Fraudsters will often produce high quality, genuine looking materials to encourage you to invest, but can you spot the frauds and the fakes? This article contains details of some common tactics used by scammers, and tips to help you avoid falling into their traps.
Unfortunately, investment scams take many forms; from fake bonds, businesses that don’t exist, and fake cryptocurrency schemes, fraudsters use a range of tricks to tempt you to part with your money. They’ll use professionally presented websites and legitimate-looking social media pages to entice you, as well as issuing high quality professional documents to give the impression of authenticity.
Criminals will try to trick you into investing in a ‘risk-free, once-in-a-lifetime opportunity, guaranteed to soar in value’. Remember that no investment is risk free. If it sounds too good to be true, that’s because it is, and a scammer is on the other end of the investment.
If you think you’ve found a great investment opportunity always seek to validate who it is you’re speaking with. A genuine financial advisor will have no problem proving who they say they are. In addition, seeking independent financial advice is always recommended.
Cryptocurrency is an increasingly popular investment choice, but remember that cryptocurrency isn’t protected by the UK’s Financial Services Compensation Scheme (FSCS) and most aren’t regulated by the Financial Conduct Authority (FCA). Genuine cryptocurrency trading platforms will most likely ask you to verify your ID, so be cautious if you aren’t asked for this. Remember that even if the investment is genuine, cryptocurrency is an extremely high risk investment choice.
Never be afraid to say ‘No!’. Scammers are likely to pressure you into investing in as little time as possible, and want you to rush in without taking the time to think about it and ask more questions.
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