What can I protect myself from being scammed when investing?

Category: General

Every year, thousands of people lose millions of pounds due to investment scams. Technological advances mean scams are becoming more common and harder to identify.

There are some warning signs you can use to avoid falling victim to scammers.

Investment scams aim to get unsuspecting people to hand over money. They can seem legitimate, appearing knowledgeable with websites, testimonials and marketing material.

The most infamous kind of investment scam is a Ponzi Scheme. This is where any new money invested pays previous investors. Eventually, the money owed is greater than the money investors are paying in. This causes the scheme to collapse, leaving everyone out of pocket.

Today, investment scams can be much more complex. Even professional investors have fallen victim to them. Those who can access their pension pots are particularly vulnerable.

All investment scams have one thing in common. They claim to be able to offer high levels of return for very little risk.

Do not feel pressured

Make sure you are aware of the warning signs that might suggest an investment opportunity is a scam:

  • Unsolicited approaches by phone call, text message, email or a person knocking on your door.
  • When a firm doesn’t allow you to call it back.
  • Where you feel pressured into making a quick decision.
  • Contact details given to you or found online, are only mobile phone numbers or a PO box address.
  • The investment provider offers high returns and low risks.

Follow simple rules

To avoid getting scammed, make sure you follow these simple rules:

  • Reject any unsolicited calls, emails, text messages or visitors to your door. Legitimate investment companies will not cold call, or contact you out of the blue.
  • Check the FCA register of regulated companies, or the FCA warning list.
  • Seek professional financial advice from an FCA regulated firm.

If you have been targeted

If you think you have been caught up in a scam, report it to the FCA Scam Smart website. If you have lost money to suspected investment fraud, you should report it to Action Fraud on 0300 123 2040 or online at

Beware of being targeted in the future, particularly if you’ve lost money to a scam. Fraudulent companies might take advantage of this and offer to help you get some or all your money back.

If you want to talk about this, feel free to book in a free no-obligation chat here or get in touch.

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