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SCAM SPOT: High yield investments or fool's gold?

03:00pm January 24 2023

The fourth episode of Westpac Wire’s Scam Spot series warns of the increasing prevalence of scams tempting their targets with promises of high yield investments. (Thomas Evans)

High returns, low risk – that's the dream for most investors.

And in order to achieve it, many people scour the internet in search of that golden investment. But among the hundreds of opportunities served up, there can be traps lying in wait. 

Unfortunately, a staggering number of those seemingly legitimate opportunities are scams.

In fact, investment scams are the biggest cause of scam loss in the country – representing half of the money lost to scams by Australians.

Many scammers will text or cold call their targets, but a growing number will set a trap and wait for you to come to them.  In the case of investment scams, the trap is a fake website boosted to appear at the top of someone’s internet search results.

These investment sites may direct their targets to a professional-looking page offering comparison tools and sign-up forms, where you enter your contact details and wait for a call.

A trained ‘salesperson’ or ‘advisor’ may impersonate real investment banks or other organisations, making it difficult to spot their malicious intent.

Here are a few tips that might help you avoid falling for these traps:

1. Don’t cooperate with advisors wanting to see your device’s screen to help ‘guide you through the process’. Remote access software (such as AnyDesk or TeamViewer) are used in a range of scams.

2.  Beware of platforms requiring payment via bitcoin or other digital currency. Legitimate investment platforms will always let you fund the account with Australian dollars (even if they are offshore).

3. If it is a company that you recognise, verify the offer directly through the company’s website or by calling them using a publicly sourced number, rather than using the contact information provided.

4. Never invest more money in order to unlock or save your existing investments – this is a common ploy used in investment scams.

5. Do not trust platforms simply because you appear to be making money, or because you can withdraw small values. Remember: numbers on a screen can be manipulated, and small deposits can be made available to gain trust.

6. For large investments, always seek independent financial advice with a professional not connected to the opportunity.

While some investment opportunities may look attractive, it’s important to know who you are dealing with. Taking just a minute can save you a whole world of trouble.

For more information about the latest scams, go to Westpac's Latest Scams & Alerts info.

Ben Young is Westpac’s Head of Fraud and Financial Crime Insights. Ben’s team researches and operates Westpac’s key fraud protection processes for the ~25 million transactions processed each day by the bank, particularly around credit cards, internet banking, branch and applications for credit. Ben has been intimately involved in Westpac’s fraud processes since 2007 and has worked in various data led risk processes since 1997.

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