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Slam investment scams!

Have you ever been offered an investment opportunity that sounded too good to be true? Were profits guaranteed? Was it called a “low-risk” opportunity?

If any of this sounds familiar, you may have encountered an investment scam. In 2011 consumers and small businesses reported to the ACCC losing more than $10 million to these scams.

Commonly victims are promised hefty returns on investments, for example in international companies and real estate. These scams are sometimes initiated through seminars, but more commonly through unsolicited phone calls, emails and letters.

Serious and organised investment fraud reported in 2011:

  • Investment and real estate scams: These scams involve high-pressure sales in high-risk investment strategies, often for investments in companies or real estate overseas. In 2011 these scams were most commonly delivered by phone but can also be delivered through seminars. In this case, scammers profit from attendance fees.
  • Sports investment scams: Scammers offer expensive software packages that promise to predict the results of sporting events or share market movements. When they fail to work as promised, refunds are hard to come by.
  • Superannuation scams: Scammers offer victims early access to their superannuation, often through a self-managed super fund. The scammer will take a large part of the super for themselves, and put victims at risk of accessing their super in an illegal way.

Protect yourself from phone scams:

  • Remember there are no get-rich-quick schemes. The only people who make money are the scammers. Exercise extreme caution when offered investment opportunities, especially if you receive an unsolicited email and/or call. 
  • Before making any investment decisions, do your homework. You may find some information about the offer or the company by doing a search on the internet. Many scams can be identified this way.
  • Check with the Australian Securities and Investments Commission (ASIC) whether the financial service provider holds an Australian Financial Services Licence. 
  • Do not let anyone pressure you into making decisions about money or investments: always get independent financial advice. 
  • Be wary of investments promising a high return with little or no risk.

Report

You can report scams to the ACCC via the report a scam page on SCAMwatch or by calling 1300 795 995.
 

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© Commonwealth of Australia 2014