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Investment Scams Claims Over £2m Per Week

2nd April 2024

Metro Bank is advising about investment scams which is its Scam of the Month for April – last year the Bank reported over six victims every week. UK Finance reports investment scams at over £2m per week and Metro Bank has already seen over £4m fraud this year with nearly one in five cases being business and commercial customers.

“These are some of the hardest and most sophisticated scams to detect because of the large amounts of money at stake,” warns Metro Bank’s Head of Fraud & Investigations, Baz Thompson.  “Investors need to be super cautious as scammers will go to extraordinary lengths to persuade, entice and defraud investors using sophisticated techniques from fake websites to posing as financial advisers to create credible investment scenarios.”

The most common investment scams are:

  1. Impersonation of genuine investment companies
  2. Cryptocurrencies – like Bitcoin
  3. Valuable jewellery, gems, or metals

The classic investment scam occurs when a criminal convinces their victim to move their money to a fictitious fund or to pay for a fake investment. The criminal will usually promise a high return to entice their victim into making the transfer. Criminals often set up cloned websites purporting to be legitimate investment firms and may even send out paperwork with official branding to add a layer of credibility to their scams. Victims may also receive an initial payment or even a couple of payments with “returns” on their investment to convince them to invest larger sums of money.

Investment scammers often use cold calling to target their victim and pressurise them to act quickly by claiming the opportunity is time limited.  Fake investment opportunities are heavily promoted on search engines and social media as well as adverts on social media offering unrealistic returns, and letters are also used heavily in investment scams. Some may seem genuine because of the use of celebrity endorsements or testimonies from people who’ve allegedly received large profits, but these are fake.

The newly released Jason Statham action thriller The Beekeeper shows how investment scammers operate by convincing victims to download a screen sharing software so they can make investments on your behalf. By downloading the software, the scammers gain access to your financial information and as the film portrays the ease and speed at which they can then empty all bank accounts in seconds.

Thompson: “We would encourage anyone thinking of investing to first check the FCA warning list before starting.  You can search alphabetically for over 13,000 unauthorised firms and websites. In addition to checking the account you are sending money to is genuine and associated with the firm.”

How to spot an investment scam:

  • Your investment has time constraints and you’re forced to make a quick decision.
  • Returns are unusually high compared to market average.
  • Quick/instant returns.
  • Cloned websites may have low quality images and logos, broken links and poorly written text.
  • You have been cold called or unexpectedly approached.
  • Ads on social media or ‘celebrity’ endorsed opportunities.

Stay safe and protect your savings:

  • Do your own thorough due diligence before parting with your savings.
  • If you’re thinking about an investment opportunity, get independent financial advice from an FCA-regulated firm and utilise the FCA warning list.
  • Never let anyone take control of your phone or computer for any reason - a reputable business would never do this.
  • If an offer sounds too good to be true, it probably is.