With rising interest rates, Australians are increasingly looking for investment opportunities to secure their financial future. This is being exploited by scammers offering fake investment opportunities through fraudulent websites.
Scamwatch sheds some light on imposter bond investment scams and provides tips for how to avoid falling victim to them.
Who is Scamwatch?
Scamwatch is run by the Australian Competition & Consumer Commission (ACCC). It aims to raise awareness about how to recognise and protect yourself against scams.
What are imposter bond scams?
Imposter bond scams usually impersonate real financial companies or banks and claim to offer government/Treasury bonds or fixed term deposits.
More than half of the victims of these scams were first contacted by phone, but many also found fake third-party comparison sites after searching online for investment opportunities.
“These comparison sites can appear very convincing, and people are providing their details under the impression that these are legitimate Australian sites comparing real financial services,” said ACCC Deputy Chair Delia Rickard.
What is the impact on Australians?
Between January and June 2022 there were losses of over $20 million attributed to imposter bond scams, representing a 265 percent increase compared to the same period in 2021.
The total number of reported cases also increased significantly, with 82 reports in the first half of 2021 increasing to 228 reports in the first half of 2022.
Scamwatch states that “The true losses to these scams are likely to be much higher, as research shows that only around 13 per cent of scam victims report their losses to Scamwatch.”
How to avoid becoming a scam victim
It is important to be vigilant when presented with investment opportunities. Key red flags to look out for are investment opportunities that promise a high return with little to no risk.
“It’s critical to independently verify the financial institution or bank issuing the bonds by calling the bank or financial service directly, using details you have sourced yourself – rather than using any phone numbers or links provided. If you seem to have been dealing with someone from the institution ask to speak to them.” Ms Rickard said.
“Always have an accredited financial or legal advisor check any potential investment opportunity before you send any money or provide your credit card details and only ever invest as much as you can afford to lose.”
What to do if you have been scammed
If you believe you have been scammed, contact your bank or financial institution as soon as possible as they may be able to trace the money and block scam accounts.
Scams can be reported to Scamwatch or to ReportCyber which is run by the Australian Cyber Security Centre.
If you have given away personal information, as most victims have, then also contact IDCARE as soon as possible.
Key takeaways
Scammers are making cold calls and setting up fake third-party financial services comparison sites to lure Australians into investing in fake bonds. It is important to be cautious when presented with investment opportunities, especially when the opportunity seems too good to be true. If you have already provided a scammer with money or personal information, take the relevant steps to report and recover from the incident.
