Investment scams target investors by promising quick, guaranteed returns. Although “investment pitches” vary, using fraudulent cryptocurrency investment opportunities to entice targets is a common approach.
Once targeted investors indicate interest, they are often instructed to wire funds abroad or to a third party’s personal account, or to transfer cryptocurrency. Fake websites and/or applications often create the illusion of a legitimate trading or investment platform and gain trust. However, once funds have been transferred, they are difficult to trace and retrieve.
5 Investment Scam Red Flags
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“Guaranteed” high investment returns, supposedly with little or no risk, and sounding too good to be true.
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Unlicensed or unregistered sellers. Use Investor.gov to check out the background of anyone offering you an investment in securities.
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Skyrocketing account values. Investments that appear to rapidly increase in value are often fake.
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Fake testimonials. Scammers often pay people to provide fake reviews, so never rely solely on testimonials in making an investment decision.
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Fake contacts. Take caution if someone approaches you through social media with an investment opportunity. Pretending to be a friend or to have a mutual acquaintance is a common tactic used to gain trust.
