Investment scams are of many types and exist in many variants. The popular ones in Australia are betting & sports investment scams.
In the USA, it is a promissory note, payphone and ATM sales, insurance agents selling securities, callable CDs., prime bank schemes, investment seminars, Ponzi or pyramid schemes, unlicensed individuals selling securities, etc. In other countries, investment scams sell unsuitable financial products by the advisor. The list is endless.
These scams usually target investors, money savers, and persons who want to get rich overnight. They provoke you through unscrupulous or fake or nearly same-looking websites to invest your hard-earned money in numerous and varied products. Like forex, cryptocurrencies, binary options, etc., the investment can also be in even more exotic products such as rare earth, wine, or even animals or cattle herds.
The scammers lure you with an exceptionally high return on your investment, quick returns, easy money, low risk, etc. There is a catch in their promise. But the reality is quite unlike the promises made by the scammers. As soon as you demand your money back, there is a complete blackout. You can no longer contact them. That is far from that sweet-talk displayed during the initial contacts.
These are the main styles of investment scams:
- The investment on offer is fraudulent or fake.
- The investment may exist, but the money you invested with the scammer does not go towards that investment but diverted.
- The scammer says they represent some (any) well-known company but are lying.
Anyway, all the money you think you have invested goes directly into the scammer’s bank account and not on the way to any actual investment. Once the money gets credited into their bank account, it is hard to recover it. It goes straight to scammers who are based overseas.
Fraudsters can scam anybody. Every scam is different from one another. It is often hard to figure out at the initial stage. They feel to be sincere, legal, legitimate, and genuine at that moment. Scammers use professional-looking (near photocopy) websites and apps and imitate known and famous companies.
Scammers can come from anywhere. They approach you through unexpected contacts like social media, phone, text messages, or email. Or they may use a real trading platform but set up fake accounts and offer to trade on your behalf. Once you deposit money with them, it is gone forever.
They may lure you through paid advertisement. The scammers pay big money for ads on social media to appear higher on online search results. The scammers promote fake news or articles or stories on social media. Copying other news channels and put-out a link directing to their scam websites.
You can get an idea of the scammers if they constantly contact you over phone calls or emails. They force you to make a quick and fast decision. They usually use the name of any reputed, famous, and popular organization to gain your confidence, faith, belief, and trust. They offer low risk but unexpectedly high returns on your investment. They are unlicensed and operate from an unknown overseas location so that they cannot be prosecuted easily.
You can check if they are real or fake. Put a few questions like asking their name, company’s name, designation in that company, company’s owner, address, phone number, etc. Are they registered with the licensing authority, license number, etc.? If they are scammers, they will avoid answering your questions or get irritated. They will give vague answers or get angry for asking too many questions.
It is a signal for you. Cut the phone, or do not reply to the email. Delete and block the person from all your social media sites. Stop dealing with him immediately. Inform the concerned authority or police.
Also, read about Cryptocurrency trading scams here
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