Scammers turn up the heat on Australian Investors

28 May 2018

Following National Scams Awareness Week (21 – 25 May), we are warning investors to be on high alert to investment scams. Figures released today from the ACCC's Targeting Scams Report show that investment scams have replaced romance and dating scams as the most lucrative method of fraud.

The ACCC’s Scamwatch received almost 33,000 reports of these scams in 2017. Over $4.9 million was reported lost by investors, with an average loss of $82,973 and more than 2,800 people gave personal information to these scammers.

In one case reported to ASIC, a complainant lost $1.2 million to criminals operating from overseas.

Offshore cold-calling is the most common type of investment scam, where a compelling investment offer is delivered by someone who will then back up the pitch with a slick website, fake research and insistent follow-up calls.

In these scams, Australians are targeted by unlicensed entities in most cases offering investment opportunities or offers of credit.

In one case reported to ASIC, a retired widow invested $450,000 in overseas listed companies before a relative became aware of the story and alerted ASIC.

In another case, a woman lost her life savings after dealing with an offshore investment broker who was introduced by a close friend. The best defence against these scams is simply to hang up.

ASIC posts details of overseas entities that investors should not deal with on the MoneySmart website, along with a list of fake exchanges and fake regulators that have been created by scammers to legitimise their false claims.

To check the offer is not a scam the person offering the investment should be able to tell you: the name of the company they represent, their address, who owns the company and whether the company or scheme has an Australian Financial Services Licence (AFSL) or an Australian Credit Licence (ACL).These can be checked on ASIC's Professional Register.

Although offshore-based unlicensed operators are beyond ASIC's jurisdiction the regulator works with financial institutions in Australia to block transfers to scammers' overseas accounts.

ASIC's MoneySmart website has useful guidance for investors on how to avoid investment scams.

What to do if you think you’ve been scammed

If you’ve sent money or shared your G&C Mutual Bank credentials or card details, contact us immediately on 1300 364 400. We may be able to stop a transaction, or close your account.

If you’ve given your personal information to a scammer, visit IDCARE, Australia’s not-for-profit national identity and cyber support service.

Scammers are often based overseas, so it’s extremely difficult to track them down or to take action against them. So take the time to warn your friends and family about these scams.

Where to go for more information 

For more tips and information about these scams or where to get help, visit the Stay Smart Online Website (www.staysmartonline.gov.au/scams2018).