Investment scams

In 2020, scams accounted for $851 million in combined financial losses, with investment scams accounting for the highest associated losses out of all the scam types.

Investment scams reported to the ACCC-run Scamwatch have cost Australians over $70 million in the first half of 2021, and projected losses are set to reach $140 million by the end of the year.

However, this does not provide a full picture of the total financial impact. In 2020, while investment scams reported to Scamwatch accounted for $65.8 million in losses, $328 million in losses to investment scams were reported to other government agencies and the major banks.

As greater investment scam losses were reported to Scamwatch in the first half of 2021 than in all of 2020, this indicates that the total cost of investment scams reported to other government agencies and banks may have also increased significantly.

The ACCC highlights some of the main investment scams impacting Australians, and warning signs to look out for.


Cryptocurrency investment scams

ACCC Deputy Chair Delia Rickard says that “Investment scams are more prevalent than ever, and scammers are capitalising on interest in cryptocurrency in particular.”

Cryptocurrency scams have been the most reported type of investment scam in the first half of 2021, and have accounted for more than half of the total losses. These scams are largely perpetrated through the use of Bitcoin.

Warning signs to look out for include:

  • The use of fake celebrity endorsements.
  • Investment opportunities with low risk and high returns.
  • The ability to access small returns initially (sourced from other victims’ initial deposits) but the scammers soon claim problems with making withdrawals and cut off contact.


Imposter bond scams

In these scams, scammers impersonate legitimate companies and offer victims the opportunity to purchase fake corporate bonds.

Older Australians looking for investment opportunities with established companies have been the most impacted group, accounting for almost half of the $6.8 million losses reported to Scamwatch in the first half of 2021.

“These scams are particularly hard to detect because scammers use the companies’ legitimate prospectuses which are registered with ASIC, link to the actual websites and have the correct ABN/CAN details. However, the scammers change key details such as contact information and bank details,” Ms Rickard said.

“That’s why it’s really important to contact the company using details you source yourself from doing a search online or visiting the company’s website directly, and to seek independent advice no matter how confident you feel.”


Ponzi schemes

The ACCC highlights the recent “Hope Business” and “Wonderful World” ponzi schemes, which resulted in more than $1 million in losses.

These scams used social media advertising and had their applications listed on official app stores. As with the cryptocurrency scams, victims who invested their money were able to make small withdrawals initially, before the scammers cut off contact.

The scams disproportionately affected people who spoke English as a second language, including recent migrants from Burma and Sri Lanka.

The apps were eventually removed from the Apple and Google app stores on the request of the ACCC.


Romance baiting

Romance scams are often connected with other types of investment scams. For example, after developing a relationship, the scammer may convince a victim to invest in cryptocurrency or bond scams.

“These scams predominantly impact younger people, who might be seeing these ‘investment opportunities’ through social media, recommendations from friends, or by registering their interest in cryptocurrency on questionable websites,” Ms Rickard said.

The ACCC urges the public not to take investment advice from people they don’t know or trust, and rather to seek independent advice from a qualified financial advisor before making any investments.


What to do if you have been scammed

If you think you have been the victim of a scam, you should contact your bank or financial institution as soon as possible.

In addition to taking your money, scammers may also use your personal information to commit identity theft and perpetrate further fraud offences.

If you supect that you are a victim of identity theft, you can contact IDCARE on 1300 IDCARE (432273) or via

Nyman Gibson Miralis provides expert advice and representation in complex cases involving scams and cybercrimes.

Contact us if you require assistance.