Investment scams are designed to look like genuine investments. Fraudsters uses the same language and terms that genuine share brokers use. See the steps below to prevent and avoid investment fraud and scams.
1. Ignore Phone Calls & Emails
If you’ve been cold called (a call out of the blue) or received an email about an investment opportunity, this will be an investment fraud or a scam. Just put the phone down and in future ignore all calls from this number.
Scammers will typically phone from Skype phone numbers and/or hide their phone number. These will show on your phone caller ID as ‘Withheld’, ‘International’ or ‘Unavailable’.
There are other ways callers can look like they are phoning from local areas and aren’t cold calling you. They may refer to a brochure or an email that they have sent you trying to sound professional. Just remember this, “if it looks to good to be true IT probably IS!”
2. Check the FCA Warning List
If you have been contacted about an investment opportunity you can check the FCA Warning List to see if the fraud company has been listed. But beware this list is not always fully up to date. Fraudsters create many fictitious companies and scams daily and as soon as one is listed on the FCA warning list, another 100 fake companies will probably have been created.
But, if a firm is unauthorised or unregulated then you will have no guarantee and no recourse if things go wrong. For example, if you buy an unregulated investment product from a firm that is not authorised by the FCA, then you will not have access to the Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS) when you discover it’s a fraud.
3. Looking to Invest? You Find them
If you are looking to invest, it’s critical that you find an FCA authorised and regulated company on the FCA approved and regulated list and not vice versa. Very simply, ensure they are an FCA regulated firm before parting with any cash or your investment is not guaranteed.
4. Check the International Warning List
Is it really worth touching an overseas investment company knowing that fraud is so rife? But if you must, please check the warnings from foreign regulators about firms conducting unauthorised business by using the International Organization of Securities Commission search.