A recent report from the Financial Conduct Authority has told UK investors that they should be informed on the dangers of investment scams, with a staggering £197m of losses due to investment scams being reported in 2018.

After the Action Fraud unit discovered that an average of £29,000 was being lost by each investment scam victim, renewed warnings have been put out, especially on the tactic of using social media for the scams.

Scams surrounding shares & bonds, cryptocurrencies and tax year-end scams were found to be the most used scam methods, with the end of the tax year being a particularly ‘fruitful’ time for investment scammers according to the FCA.

Mark Steward from the FCA stated that: “The first quarter of the year is a common time for people to make their financial plans for the year, including investments. Before you invest, do some homework, check the FCA’s register to make sure you’re dealing with an authorised firm and use the contact details on our register to avoid ‘clones’. Also, check the FCA warning list of firms to avoid. If you’re in any doubt – don’t invest.”

In 2018, 54% of people who checked the FCA Warning List said that they had been contacted by investment scammers using online methods, which was up from 45% the year before. The FCA Warning List helps people to identify any risks related to a possible investment, as well as a search list of firms which the FCA knows do not have its authorisation.

Offering comment, Tom Selby, a Senior Analyst at AJ Bell, said: “These latest investment scam figures are truly shocking. The crooks behind these schemes have a habit for targeting elderly and vulnerable people, stealing vast sums of money and often leaving their victims facing destitution. The best way to protect people from scams is to arm them with the tools to protect themselves. It is crucial all parts of the industry build on this success by providing savers with the information and help they need to make sensible investment decisions.”

Jane Goodland, a Corporate Affairs Director at Quilter, added: “People tend to read about scams and think, ‘that would never happen to me. But with investment losses totalling £197m, that clearly is not the case. In fact, to put the figure in context, the average loss to a scam of £29,000 is nearly five times the annual amount saved in a typical ISA. In truth, the real cost is not only the £197m lost by victims of fraud, but the untold amount of investment growth that potential investors forego because they fear being scammed or don’t feel able to discern legitimate investment opportunities.”

 

Here at Pension Justice, we have worked with many individuals and families around the UK who have been mis-sold an investment, or been scammed in some other way related to financial matters, whether online or elsewhere.

We can provide a free consultation where we discuss your situation and advise you on the best course of action for you to take moving forward, including any possibility for claiming compensation. Get in touch by phone on 0800 014 8275, email on info@pensionjustice.co.uk, or by contact form over at our Contact page today to find out more.