Fake cryptocurrency and investment opportunities are among the biggest scams on social media. It starts when a scammer contacts you, usually by sending you a direct social media message. They’ll start off by trying to build a relationship but then quickly share information about a “great investment opportunity” that helped them “make so much money so fast.”
Warning signs of a social media investment scam:
- Promises of very high returns with zero risk e.g., to double or triple your money in a very short time
- The social media profile shows exotic overseas travel destinations, expensive cars and designer clothes
- Urgency to invest – fraudsters do this to limit the amount of time you may spend researching and thinking about the investment
- Anything sold as a “once-in-a-lifetime opportunity” should be a warning sign
- Requests to recruit new investors
- Professional-looking investment websites or crypto exchanges with little to no information about the company
- If it is difficult to understand how the investment product will make returns, you should be cautious
- The scammer offers to walk you through your first few trades and claims to have insider knowledge of the market
Tips to avoid investment and cryptocurrency scams:
- Do a thorough online search
- If an investment is not registered with a body like the Financial Services Conduct Authority (FSCA) it is not regulated. Contact financial bodies to verify the registration of an entity
- Don’t share any personal information until you’ve verified whether the company is legitimate or not
- Do not send money to anyone who has reached out directly over social media
