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How to Protect Yourself from Investment Scams

How to Protect Yourself from Investment Scams

In 2024 alone, investment scams caused the largest financial loss amongst any other scam category—accounting for 23% of all losses (£80.3 million) and affecting 2.5 million people. 

In this article, we’ll explain how these scams work, the warning signs that may signal a scam, and the steps you can take to protect yourself. We’ll also explain how a specialist recovery firm can help recover funds lost from fraud.

 

 

How investment scams typically work 

People who fall victim to investment scams believe they’re investing in a real opportunity from a genuine company. These companies often pose as regulated brokers, financial advisors, or fund managers, and often appear credible with professional websites and marketing materials.  

There are also other cunning tactics involved. One is pressuring you to make a quick decision, so you don’t have breathing space to research the “company”. The scammer may also use complex jargon to confuse or mislead you.  

Another common tactic is for the scammer to build a relationship with the victim, gradually gaining their trust until they hand over sensitive financial information.  

 

The warning signs of an investment scam 

Some of the most common signs to watch out for include: 

  • Companies contacting you out of the blue about an investment opportunity 
  • You’re pressurised with a limited-time offer, such as a bonus or discount, if you invest before a set date 
  • They promise great returns or special offers that sound too good to be true 
  • They keep calling you and keep you on the phone for a long time 
  • Endorsements from trusted celebrities (such as Martin Lewis) using AI deepfakes 

 

List of high-profile investment scams  

The emergence of AI has brought a worrying new trend. Scammers now create highly realistic fakes of trusted celebrities endorsing fraudulent platforms.  

Martin Lewis and Elon Musk have both been the faces of impersonation scams. Scammers have exploited their profile to trick victims into believing an investment opportunity is genuine. 

Of course, AI isn’t the only threat to investment opportunities. Some of the most high-profile investment scams we’ve covered recently include: 

  • Monetio: A fake investment trading platform that promised quick returns but conned many out of thousands. 
  • XTradeMax: An unregulated trading platform that offered enticing benefits but stole thousands from victims. 
  • Diamond Ridge Financial Academy: Also known as ‘Diamond Ridge Academy’ and ‘Diamond Ridge Asset Management’, this fraudulent entity stole funds from victims who believed they were gaining valuable investment guidance or investing in cryptocurrency. 
  • YieldNodes Crypto Investment Scam: Rising to prominence in 2022, the platform promised returns far above traditional investments but turned out to be entirely fraudulent. 

 

How to protect yourself from investment scams 

You can protect yourself from investment scams by: 

  • Taking time to research the company history and its reviews. 
  • Always getting a second opinion before deciding. 
  • Trust your doubts if you think something seems suspicious. 
  • Verify any celebrity endorsements through trusted channels. 
  • Validating returns against market norms—if returns exceed this, ask yourself if the investment opportunity is too good to be true. 
  • Avoid remote screen sharing or installing unknown apps from apparent investment brokers. 

 

What to do if you’ve been targeted by an investment scam 

If you’ve been targeted by an investment scam, there are a few steps you can follow to keep yourself and others safe. 

Firstly, we recommend reporting the issue to the Financial Conduct Authority (FCA) and Action Fraud. As the UK’s largest financial regulator, the FCA can investigate and add a company to a warning list if it’s a scam. This list helps people avoid firms that expose them to fraud risks. 

Action Fraud is the UK’s central national reporting centre for fraud and cybercrime. While they don’t investigate your case directly, reports are handed to the National Fraud Intelligence Bureau, who are overseen by the City of London police. They can ensure your fraud report reaches the right place.   

We also advise being highly cautious of ‘recovery room’ scams. This is where scammers reach out to fraud victims, offering to recover their money for an upfront fee. However, these are usually the same con artists who stole from them originally, tricking victims into being scammed again.  

 

Need support after an investment scam? 

If you’ve lost money or cryptocurrency to an investment scam, contact Wealth Recovery Solicitors. Our recovery specialists can help trace your lost funds and recover what’s yours.  

We know how to get results for our clients. In fact, we’ve helped recover more than £50,000,000 for fraud victims in the last three years. With a 4.6-star rating on Trustpilot, you can also expect superior client service at WRS. Our UK-based specialists are on hand to provide reassuring, expert advice when you need it.  

 

Why choose Wealth Recovery Solicitors?  

  • ETL Global Partner: Access to a trusted international legal network  
  • £50,000,000 + recovered: Proven track record of success in complex fraud cases  
  • 4.6 Trustpilot rating: Excellent client feedback for service and results  
  • No-win, no-fee: You only pay if we successfully recover your funds  
  • Free consultation available: Get in touch to speak to a member of our team to discuss your inquiry  

Get in touch to take the first step towards recovering your lost funds.