The site has been plagued by a number of investment scams that make money on people. While these are often pointed out to beginners, knowledgeable publishers can fall prey to these scams.
These scams can take any form and are constantly evolving like chameleons. According to the FCA, clone investment scams have increased by 29% during the Covid 19 period to 2020.
Some of these online publishing scams are very real and hard for publishers to detect. An FCA study showed that 15% of investors find it difficult to spot a scam and 77% do not know what a cloned investment is.
Undoubtedly, the internet is a popular site used by scammers to deceive people. Most of these victims are people who are looking for a quick-witted investment. But there are some scam techniques that are widely used.
Because long -term investments can be made, you can be deceived and not realize it until years later.
For example, if you buy a fraudulent certificate, you may receive a coupon fee every year, but in the future, your original certificate will not be refunded to you. These scams are often portrayed as a real scam until the victim is deceived.
The London Capital and Finance scandal is a prime example of a bond scam. People were tricked into buying IOUs that were branded as collateral, and about 11,600 people were deceived.
Some of these scams are advertised in newspapers, magazines and online businesses to convert other people and show their approval.
Most scammers probably have FCA licenses and this gives them a high level of trust in the eyes of investors. Unfortunately, they are betrayed into a direct relationship and act deceptively.
Bond scammers are constantly in contact with well -designed systems and large bureaucracies to get this halo effect. The FCA is in agreement with use or lose the policy if the licensee does not return it at some point, the license is lost.
The Romance Scam
Romance scams are one of the newest ways that scammers use to deceive their victims. Early connections are often made through social networking sites and web platforms
In some cases, victims are believed to be in a loving relationship. Scammers often disguise themselves as professional marketers or executives with many social media sites to support their persona.
Running on trust built on love, the victim will be encouraged to open a trading account via a link sent by fraudsters. In most cases, brokers are not registered.
Once the record is left in a file, then go to the fraudster. Fraudsters sometimes use a registered subscriber but it is time for the subscriber to leave the archive, and then they provide a link to take the money to the fraudster.
UK Finance estimates that between January and November 2021, UK people lost £ 18.5 million to romance scams.
Pum and Dump Scam
The Pump and Dump scam is a manipulative way to get profit from the capital market. It is done by increasing the value of an asset through false words or misinformation. The purpose of doing a purchase around a property is to increase the ‘Pump’ price.
Then the criminals will then ‘Dump’ the property to new buyers. After the dumping, the price of the property will fall sharply and investors will lose.
Social media, email, text messages and financial news are some of the vehicles that blow up and dump criminals who are used to doing their jobs. Their goals are small companies or small businesses because of their low market share.
An example of a scam and a dump scam is illiquid cryptos, meme stocks where ‘insider’ users congregate and buy large volumes of shares, thus demanding that the price increase. They will later sell their shares to return the price to its original level.
Transformed Ponzi schemes
A Ponzi scheme is an investment fraud that pays existing investors with money collected from new investors. It started in 1920 and was named after Charles Ponzi who promised a 50% return on investment.
That’s one of the biggest financial pitfalls. The assurance of a high return on investment is what often attracts unscrupulous investors.
Ponzi scammers do not invest in the money paid by investors. But they also make money among investors. With early adopters often found to be profitable.
Nowadays, Ponzi schemes are replaced by getting a license to invest money as a legitimate business and then starting a Ponzi scheme with a legitimate financial business.
The money laundering scam is attributed to the fraudsters. Proponents of this crime will pledge to help get you back the money you lost through fraud. Instead, they tend to add salt to your pain.
Typically, they use social media or local newspapers to investigate fraudulent complaints. They also use false testimonials, reviews and evaluations to establish legitimacy.
Convicts were, therefore, asked to pay the first installment of most of the money lost. They can buy the information provided by the victim on the black web or use it to deceive him at a later date.
Even if there are real and valuable assets or financial institutions, there are also many who just want to benefit from your injury.
Forex Brokerage Scam
A forex scam is a term given by an unauthorized or unlicensed forex broker to provide forex services. Those brokerages can be contacted at any time and they can put your capital at risk.
This is the majority of forex brokerage operating from other countries that has not implemented any critical market regulation.
It is important to note that there are many forex brokers operating in the UK, but not all of them are regulated. This comparison of FCA regulated forex brokers shows that there are many licensed brokers in the UK that offer forex & CFD trading, but there are some 100s of unregulated brokers that allow clients to trade legally.
Trading with an unregistered forex broker is a big problem. When an FCA licensee leaves the business, investors receive a fee from the FSCS. However, this is not the same as for unlicensed security.
You have to choose a FCA license license that’s right for you After choosing a forex broker, you need to verify their authenticity by visiting the FCA website and navigating to the Forex Trading page.
Forex signal fraud
Forex signal providers help forex traders identify available trading opportunities. Forex signal providers are expected to register with FCA. However, people often go to buy tokens without permission.
For example, the FCA has issued a warning warning the public to oppose a service called ‘Direct Forex signals’ because they are not registered. The FCA also states that using an unregistered provider is at your own risk and you will not be paid from the Financial Services Compensation Scheme (FSCS), if you are deceived.
Due to the strong demand for market signals, forex fraudsters will create fraudulent signals that they will sell to traders in cash. New traders are often the ones who complain about forex trading signals.
Fraudulent Hire Seminars
It’s an event designed to organize investing as an easy journey to separate people with their money. In most cases, they advertise commercial offers and products such as books or videos to convert money.
They often use the words “prove” and “double your money” to mislead innocent people. Please note that investing in the capital market is not guaranteed. You should not be misled by the word “guaranteed”.
This is done by hackers to hack into your account and block you from accessing it. Social accounts and personal files are their goals.
They will then require you to upload a video that supports their product or service, before leaving control of your account.
They use uploaded video to impress people with your network of affiliates, that their product or service is real if, in fact, they are not.
Deceptive Water Supply
This scam is often caught by people through the business or social media pages of the bank. They post malicious links in different languages. For example if you complain about not receiving notifications in your banking system, the scammer will immediately send you a link to click that result.
People who are looking for solutions to their complaints will always fall prey to this scam. Well -off criminals will have access to valuable information of victims that they can sometimes buy on the black internet or use to deceive them.
Online banking scams can take a variety of forms. Nowadays it has become more widespread with the use of the internet. Thousands of UK people lose millions each year to online banking scams.
The best way to protect yourself from falling victim to these scams is to always make sure you spend time investing with FCA before you decide to invest your money.