Scams & fraud
How investment and crypto scams hook people, and how to check before you invest
Investment scams cause some of the biggest losses of any scam type in Australia. They rarely look like scams. They look like a professional trading platform, a news article about a famous person’s secret strategy, or a friendly mentor who shows you their profits. By the time the warning signs appear, people have often invested their savings.
The short version
Before you invest
- Check the company holds an Australian financial services licence.
- Be wary of anyone you met online offering investment tips.
- Never let a stranger install software or guide your trades.
- If you can’t withdraw without paying a “fee”, stop.
How they find you
- Fake news articles and ads on social media claiming a well-known Australian has made a fortune using a new platform. The celebrity has nothing to do with it.
- A friendly stranger on WhatsApp, Telegram, a dating app or LinkedIn who mentions how well their investments are going and offers to show you.
- Comparison or “investment advice” websites that collect your number, followed by calls from a pushy “account manager”.
- Investment groups in messaging apps full of members, many fake, posting screenshots of big returns.
How the scam unfolds
A small start
You’re encouraged to invest a few hundred dollars on a slick website or app. Your balance seems to grow quickly.
Growing confidence
You might be allowed to withdraw a small amount, which makes it feel real. Your “adviser” is attentive and encourages you to invest more, perhaps using savings, super or a loan.
The trap closes
When you try to withdraw a large amount, there’s a problem. You need to pay a tax, a release fee or an anti-money-laundering deposit first. Each payment leads to another. The platform and the balance were never real.
Checks that expose a scam
| Check | How |
|---|---|
| Is the company licensed? | Search ASIC’s professional register for an Australian financial services (AFS) licence. Check the licence name, number and contact details match the company you’re dealing with exactly. |
| Is it on ASIC’s warning lists? | Search the company name on Moneysmart and ASIC’s investor alert list. |
| Are the returns realistic? | Guaranteed, high or very fast returns with little risk don’t exist. |
| Who contacted whom? | Be cautious of unsolicited contact, especially from someone you met online. |
| Is a celebrity involved? | Treat any celebrity endorsement of an investment as a warning sign. |
Scammers copy real companies
Some fake platforms use the name, licence number or address of a real licensed firm. If the checks look fine, contact the firm using details from ASIC’s register, not from the website or person you’ve been dealing with, and confirm they know you.
Red flags
- You’re asked to download remote access software so someone can “help” you trade.
- You’re pressured to act quickly before an opportunity disappears.
- You’re told to keep it secret from your bank or family.
- You’re asked to buy crypto and send it to a wallet address you’re given.
- Your “adviser” is also someone you have a romantic or close relationship with online.
- Withdrawing requires paying a fee first.
If you’ve already invested
- Stop sending money, whatever you’re told about fees or deadlines.
- Call your bank straight away. If you bought crypto through an Australian exchange, contact the exchange too.
- Don’t let anyone back into your computer. If you installed remote access software, uninstall it and get the device checked.
- Report it to Scamwatch and to ASIC through its online form. Report online losses to ReportCyber.
- Get support from IDCARE on 1800 595 160 if you shared ID documents.
- Expect recovery scams. People who’ve lost money are often contacted by fake lawyers, “crypto recovery” firms or even fake regulators offering to get it back for a fee.
Common questions
I saw my balance grow and withdrew some money. How can it be a scam?
Small withdrawals are part of the plan. They build trust so you invest more. The balance on screen is just numbers on a website the scammers control.
The website has an ABN and looks professional. Is it legitimate?
An ABN doesn’t mean a company can offer financial products. Check for an AFS licence and confirm it matches.
Can I get my money back?
It’s often difficult, especially with crypto. Acting within hours gives the best chance. Report it regardless, because reports help authorities shut down sites and trace funds.
Sources
This guide is general information, not legal or financial advice. If you think you’ve lost money or personal information, contact your bank and the services named above straight away.
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