ASIC is aware of greater numbers of scammers taking advantage of people throughout the COVID-19 pandemic. Reports of misconduct to ASIC over January/February 2021 are up by more than 200% compared to last year.

Many scammers are sophisticated at creating fake platforms, which often include imposter social media pages, websites, phone lines, fake regulators and stock exchanges. It’s increasingly difficult to differentiate between legitimate companies and scammers.

“Australians are at risk of being scammed and losing money, and scammers are using age-old tactics in new and sophisticated ways to target people,” said Warren Day, ASIC Regional Commissioner for Victoria.

Mr Day recently shared his tips for identifying and avoiding scams on ABC Radio.

What is a financial scam?

A financial scam involves a victim parting way with their money on the promise of a questionable financial opportunity.

Scammers may offer a range of investments with modest to high returns, advertised as having little, or no risk at all. One recent variation offers a fake opportunity to invest in imposter bonds, preying on investors searching for a higher rate of return than current low interest rates can provide.

Avoiding financial scams

• If an opportunity seems too good to be true, it probably is.
• Sign up for the Australian Government’s Do Not Call Register to reduce unsolicited telemarketing calls. Any callers that ignore your listing on the register are probably not legitimate.
• Scammers can create emails with logos, text and phone numbers that look almost identical to those from legitimate organisations. A sign that an email is not legitimate is that it comes from a free domain, such as gmail.com, or adds extra numbers and symbols to the official email address. Delete suspicious emails without opening any attachments.
• Scam emails will often try to create a sense of urgency or time pressure to trick victims into clicking on a hyperlink to a fake website. It is good practice to avoid clicking risky hyperlinks by manually searching for the real website, where any real notifications will be available to action.
• Dating sites and apps have increasingly become host to crypto-asset scams. Beware of profiles that suggest or pressure you to participate in ‘third party’ crypto investments. Most crypto-asset investment opportunities reported to ASIC appear to be outright scams with no actual underlying investment.
• Scammers often use targeted advertising on social media to attract victims. When using online platforms, don’t assume that all ads come from legitimate businesses. If in doubt, check ASIC’s register of Australian financial services licensees to make sure any party promoting or issuing the financial product is licensed or is authorised by a licensee.
• Credit cards can be useful for adding an extra buffer of protection against scammers. Avoiding the protection offered by the banking system is why scammers will often ask for direct transfers into a bank account or payment via a crypto-wallet. Banks have effective fraud detection units and are more likely to refund your money if you use your credit card to make purchases. 

If you think you or someone you know has been scammed, lodge a report of misconduct with ASIC.

For more information on bonds and investment scams visit ASIC’s Moneysmart website.