Why do scams work?
More people can now invest in stocks, assets, and digital currencies (cryptocurrency) than ever before. Many are using the Internet and social media to learn where to put their money. But with so many choices and with so many scams out there, there's a big chance of getting tricked or making a bad choice.
Scammers use a number of tactics to try to trick people:
- ‘Easy money’ offers: scammers will promise quick and high returns.
- Limited-time offers: make people think they need to invest immediately or they will miss out.
- Fake celebrity support: scammers will make up fake news stories and use photographs from elsewhere to make a scam look like it has a celebrity’s approval. Elon Musk Investment scams are currently the most popular use of a fake celebrity endorsement.
- Fake reviews: scammers put fake reviews of a product or service to make the scam look real.
- Real-looking websites: the scammers make sure that their websites look real to make it seems like a professional operation.
- Complex language: scammers may use complex financial jargon or misleading language to confuse potential investors and make their scam seem more legitimate. Many scammers rely on the general public’s lack of knowledge about cryptocurrency to make impossible schemes seem realistic.
Tips for keeping your money safe
- ‘Get rich quick’ schemes are scams. And if someone says you can make money or digital coins very fast, it's probably not a real investment scheme.
- Don't trust adverts or unexpected offers online, on social media, or over the phone.
- Ignore unrequested investment offers: these offers may appear online through paid adverts or show up on social media or you may even receive a call on the phone.
- On social medial platforms (e.g. Facebook), if a friend messages out-of-the-blue about an investment scheme, ignore the message and contact your friend by other means, as it’s not likely to be your friend messaging you.
- Do not download any programs (e.g. AnyDesk) onto your computer, if told to do so by an investor. Remote Desktop Access Scams are extremely common.
- Before you invest, do your homework and maybe ask an expert for advice.
- Try the ScamSmart Investment Checker to see whether an opportunity is unsafe.
- Always use real and official investment companies. UK FCA warning list of known firms to avoid and the Isle of Man FSA publishes warnings on their news page.
- Check whether the investment company is registered:
- The Isle of Man Financial Services Authority (FSA) has a searchable list of registered entities on the Island (Crypto-investment firms on the Isle of Man aren’t currently regulated but should be registered with the IoM FSA for anti-money laundering oversight.)
- The UK’s Financial Conduct Authority (FCA) also has a register to check information about registered UK firms or individuals
Useful Contacts
Have you been scammed?
Call your bank as soon as you can and report it to us.
Don't feel embarrassed about reporting a scam – scammers are clever and scams can happen to anyone!
Noticed a scam website or advert?
If you believe a website or advert is a scam or it’s pretending to be a real company, please let us know by using our form.
Understanding cryptocurrency
More information about cryptocurrencies and what to look out for when investing can be found on the Isle of Man FSA website and ICOs and cryptocurrency: What’s all the fuss about?’
Page last reviewed - 23/04/2024.
