Most mobile phone users around the country have probably received an unwanted spam message from a particular politician this week, which, while annoying, could just be ignored or deleted.
Of greater concern, however, are the increasing numbers of bogus investment scams that have cost Australians over $70 million in the first half of this year – more than the total losses reported for all of 2020.
Data released this week by Scamwatch shows a 53.4% increase in reports about investment scams received so far. In addition to taking victims’ money, scammers often commit fraud or identity theft using the information they obtained from the victim.
Cryptocurrency trading scams
ACCC Deputy Chair Delia Rickard said that investment scams are more prevalent than ever, and scammers are capitalising on interest in cryptocurrency in particular.
“More than half of the $70 million in losses were to cryptocurrency, especially through Bitcoin, and cryptocurrency scams were also the most commonly reported type of investment scam, with 2,240 reports.”
Scammers pretend to have highly profitable trading systems based on individual expertise or through algorithms they developed. Many of these scams also use fake celebrity endorsements to try and enhance their legitimacy.
“Be wary of investment opportunities with low risk and high returns. If something sounds too good to be true, it probably is”, Rickard said.
Losses to other types of investment scams, including imposter bond scams, Ponzi scams, and romance baiting scams are also increasing, while traditional investment scams are also still very common.
Imposter bond scams: In these scams, scammers impersonate legitimate companies and offer victims the opportunity to purchase fake corporate bonds. Older Australians looking for well-known respected companies to invest their money in have been the most impacted, making up 43% of reports and accounting for almost half of the losses.
Ponzi schemes have also increased. In the first six months of this year, Scamwatch received over 400 reports and more than $1 million in losses to the Hope Business and Wonderful World scams, which advertised on social media sites and had apps available via official app stores. People invested their money and were able to make small withdrawals in the beginning before the scammers cut off contact.
Romance baiting: Investment scams originating through dating apps and websites are becoming increasingly common. In these scams, a scammer develops a relationship with the (usually younger) victim and convinces them to invest, usually in cryptocurrency or bond scams.
“Remember, never take investment advice, send money or give credit card details, online account details or personal information to anyone you don’t know or trust, and never to someone you have only met online or over the phone, as you never know who you might be dealing with”, Rickard advised.
The ACCC is urging everyone to seek independent advice from a qualified financial adviser before making any investments.
What to do if you think you have been scammed
People who think they’ve been scammed should contact their bank or financial institution as soon as possible. They can also contact IDCARE on 1800 595 160 or via the idcare website, make a report to Scamwatch, follow @scamwatch_gov_au on Twitter and subscribe to Scamwatch radar alerts.