How to avoid investment scams
Publication date:
09 September 2020
Last updated:
18 December 2023
Author(s):
Personal Finance Society
The UK Industry regulator FCA, Financial Conduct Authority, is urging individuals to be ‘ScamSmart’ especially in the covid-19 virus outbreak period.
Spot the warning signs:
- Unexpected contact – Traditionally scammers cold- call but contact can also come from online sources e.g. email or social media, post, word of mouth or even in person at a seminar or exhibition.
- Time pressure – They might offer you a bonus or discount if you invest before a set date or say the opportunity is only available for a short period.
- Social proof – They may share fake reviews and claim other clients have invested or want in on the deal.
- Unrealistic returns – Fraudsters often promise tempting returns that sound too good to be true, such as much better interest rates than elsewhere.
- False authority - Using literature and websites that are hard to distinguish from the real thing, claiming to be regulated, speaking with authority on investment products.
- Flattery – Building a friendship with you to lull you into a false sense of security.
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