Investment Scams

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What is an investment scam?

An investment scam often presents as a “high return/low risk” opportunity. These investment opportunities may include shares, real estate, term deposits, bonds, mortgages, options or foreign currency trading, crypto currencies e.g. bitcoin, betting syndicates or even foolproof prediction software - all with the purpose to steal an investors' money.

Scammers pose as bankers, stockbrokers, financial planners, or other investment professionals. They appear knowledgeable and confident on investment matters and even direct you to legitimate looking websites and prospectus documents.

The account name you are directed to pay into differs from the investment company name or may be established in your name. Accounts in your name are often created by scammers who request you to share identity documents with them. They often ask you to take photo with your identification. These accounts may be created in your name but are controlled by scammers, sending your money into other accounts they control.

Online investment scams have been known to use celebrities’ names and pictures (without them knowing) to endorse their schemes. If you see an investment on social media with a celebrity endorsing the investment, be alert that it’s potentially a scam!

Investment scam call example

Steve is a 65-year-old retiree who lives alone. Not long after his wife passed, he received an unexpected call about an investment opportunity. The caller sounded very professional and seemed to have excellent knowledge of investment matters. They answered all of Steve’s questions and their initial contact was followed up with a call from a ‘senior advisor’.

As Steve’s superannuation was not doing so well, he decided to explore this new investment opportunity. He did not think to discuss the opportunity with anyone else.

Over the next 12 months, Steve made a number of transfers to the 'investment professionals', initially starting with $10,000. He was referred to a very professional looking website and set up an account, which showed his money increasing in value as the market ‘went up’. Confident the system was working, he invested more money, to a total of $200,000.

He only realised that the investment scheme was a scam when the website went down, and he could no longer access his account or contact the offshore group by phone.

His money was never recovered. Unfortunately he was forced out of retirement after losing all his savings.

Investment scam website example

Alex was researching investment and term deposits online, to see where he would get the best return on his money. After reviewing various sites, he came across a website offering a high yield fund with higher-than-expected returns, all backed by a well-known company. The fund promoted 100% of his capital would be safe with various levels of protection.

To request additional information, he was required to enter his personal details to the website to be contacted by a representative.

Shortly after he received a call from an Advisor who talked him through all his available options. He was also sent an investment prospectus to review. The prospectus appeared genuine and included information such as a CEO report, a detailed breakdown, performance history and other terms and conditions about the investment.

Alex believed this was a genuine document, as it was formatted to resemble the well-known company and included professional-looking imagery, including references to governing bodies.

Alex thought he would check with the company who was backing up the investment, just to ensure he had done his due diligence, and luckily for him they advised him this was a scam.

Signs this may be a scam

The investment is just too good to ignore.

Treat any opportunity as a potential scam. There is always the risk of financial loss when investing. Always seek independent advice from a qualified party where online/phone conversations are your only source of contact.

Professional-looking websites, apps or brochures.

Scammers may provide written or verbal consultations, such as well-designed documents that may appear credible to support their claim.

You’ve been assigned an advisor.

Using remote access software, your advisor helps you completing your trades. Always check financial advisors are registered via the ASIC website.

You can only see your investment on one device.

Caution! If you cannot access your investment from apps located in the app store or a website available on various devices it’s likely your investment may be a scam.

What you can do if you
come across a scam

Let us know

Please report scams or suspicious activity immediately to Westpac at 132 032 or +61 2 9155 7700 (if calling from overseas).
Forward suspicious emails to hoax@westpac.com.au or SMS/text messages to 0497 132 032 then delete the email or message.
You can also report all suspicious activity to the Australian Cyber Security Centre at cyber.gov.au/report.

Get support and stay in the know

IDCARE provides free, confidential support and guidance to those impacted by fraud, scams, identity theft or compromise. Call them toll-free on 1800 595 160 or visit idcare.org.
Keep up to date on scams by subscribing to the government's scam email alerts from scamwatch.gov.au/subscribe.
Check out our latest scams, for copies of recently reported scams at westpac.com.au/scams.

ScamSpot: a series of 2-minute bites to help spot the latest scams

Things you should know

* Examples are based on one or more real scam reports received by Westpac. For privacy purposes real names have not been used.

Investment scams