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Is it a legitimate investment? What is an investment scam?
How to spot an investment scam
An investment scam binary options workshop when someone offers you a fake - but often convincing - opportunity to make a profit after they investments on the Internet investor reviews over a sum of money. The investment exists but the scammer takes the money instead of putting it in the opportunity.
Investment scams in focus: cryptocurrency scams Cryptocurrencies are virtual peer-to-peer currencies that are decentralised.
Bitcoin is the most famous cryptocurrency, but there are more than 1, cryptocurrencies including other well-known ones such as Ethereum and Litecoin. Many legitimate businesses — such as Expedia and Microsoft — accept cryptocurrencies as payment.
Quick transaction times is one of the reasons people like cryptocurrencies.
But, cryptocurrencies also allow you to pay for or sell something anonymously, so they also appeal to scammers and shady online dealers. Before a new cryptocurrency is launched on an exchange, you will be able to buy cryptocurrency coins or tokens as part of an Initial Coin Offering ICO.
This is usually what's known as a pump-and-dump — when a price becomes inflated at launch, and then rapidly crashes. Do not hand over any money. This could be through a cold call, text, message on social media, email or brochure.
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They pressure you into making a rushed decision. This could be with a limited time offer, bonus or discount if you sign up before a deadline. They call or email you repeatedly or keep you on the line. This is to try keep you engaged so they can pressure you to make a rushed decision. It seems too good to be true.
The old saying rings true - if they downplay the risks but the investment is high return, it could be an investment scam. They ask you to keep the investment quiet.
The scammer might tell you the investment opportunity is just for you and ask you not to tell anyone. In the UK, a firm must be authorised and regulated by the FCA to do most financial services activities. You will likely be approached either through a cold call on your landline or mobile or via an email or text. The questionable investment could be advertised on social media or in a pamphlet.
I think an investment scammer has contacted me Hang up.
Stop all contact with the scammer. Report it.
Use our guide to report a scam. These are some of the most common scam investments. Ponzi and pyramid schemes. Where money from new investors is used to pay former ones.
Binary options. Betting on whether the price of something will go up or down, for example gold, oil or stocks, and you can either win or lose. Unregulated products.
Such as gold, diamonds, wine, hotels, bamboo, parking, storage, student accommodation. Early pension release.
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You may never see your money again, and get hit with a hefty tax bill. Land banking. You buy a small plot of land which will be sold to a developer for a big profit. A type of carbon which may be used in some electronics in the future.
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Scammers put the pressure on to invest quickly. The market is unregulated. Forex investments on the Internet investor reviews. Unauthorised traders offer guaranteed profits and most victims initially get a small return to think the trader is legitimate. Online investment scams Fraudsters now use platforms such as Facebook, Instagram and Twitter to lure people into investing in cryptocurrencies, foreign exchange and binary options.
The scammers often have convincing social media profiles or websites with bogus reviews. The Financial Conduct Authority warns that fraudsters promote themselves through social media channels by using pictures of luxury items, such as expensive cars and watches, to entice people.
They will claim what they are offering is low-risk and will provide you with quick and high returns, or encourage you to invest in overseas companies. They will be persistent, and may keep calling you back.
Always check the investment is legitimate before handing over any money. Consumer Rights.