If it sounds too good to be true, it probably is

We all know the sting of investing money in something that wasn’t quite worth it – an expensive organic avocado that was rotten on the inside, a new pair of shoes whose stitching came apart after one wear or a second-hand car which landed at the mechanic two weeks after purchase. This can leave you feeling foolish, hoodwinked and disappointed.

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While the same can be said in the case of investment scams, the monetary loss is of a much higher value. In turn, the consequences can be devastating for victims.

"These scams are often hard to spot and can appear legitimate with professional-looking websites or apps impersonating real companies. They can be so convincing even the savviest of investors has been deceived.”

Investment scams claim more money from Australians than any other scam type. In 2023 they accounted for more than 60 per cent of scams reported to the Australian Competition and Consumer Commission’s ScamWatch, with a collective value of about $293 million. 

While this amount is shocking, it is likely actual losses are significantly higher because many Australians don’t report when they’ve been scammed.

Scammers target potential investors – including those looking to invest in Bitcoin and other cryptocurrency – because if cyber criminals can trick these high-value targets, they can steal significant amounts of money in one transaction.

Increasingly sophisticated in their marketing techniques, investment scams promise big payouts with little or no risk to encourage people to act fast.

These scams are often hard to spot and can appear legitimate with professional-looking websites or apps impersonating real companies. They can be so convincing even the savviest of investors has been deceived. 

The investment scam playbook

The methods investment scammers use to contact customers are varied – fake websites with ‘contact us’ forms, paid advertising through social media and often direct contact by phone, social media, email or text message. Scammers use the latest investment trends and often use well-known company names and platforms to convince customers of their credibility.

These scams can take time to build as the scammer builds trust with the customer, sometimes over many months, in order to convince them to make larger payments.

In some cases they achieve this trust by making small payments to the customer to prove the validity of their investment opportunity. In other cases they take over a customer’s device to fabricate increases in their online accounts.

One factor is constant though – customers will be offered guaranteed, quick and easy investment returns or higher-than-market returns. They will often also promise the ability to sell at any time or receive a refund for non-performance. 

On many occasions, customers have provided remote access to their computer providing scammers with an opportunity to reiterate the legitimacy of the investment. In doing so scammers gain access to customer’s personal information, further increasing their vulnerability to scams and fraud activity.   

Education remains a key factor for protecting our customers. In a recent UK study, 91 per cent of participants said they would never share their PIN with a stranger but 85 per cent admitted they wouldn’t see a website requesting to use or download software as a warning sign someone was seeking to gain illegal access to their personal information. 

Banks can detect atypical customer behaviour, investigate and speak with customers to understand why their behaviour may have changed. However, customers involved in an investment scam are often convinced their investment is legitimate and do not wish for banks to intervene. 

Scammers are often prepared for banking employees to intervene and coach customers on what to say to bank staff to remove suspicion and have a payment released.

Staying Scam Safe

The Australian Securities and Investments Commission recently shut down 3,500 investment scam sites and we continue to work with regulators, telecommunication companies and digital platforms to remove fake investments before they reach customers.

To help combat the rise in scams and fraud, ANZ Plus has developed Scam Safe – a suite of enhanced controls, scam-focused features and educational content to help our customers protect themselves and their money.

Screen Share Protect

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Given customers often do not require screen sharing for their banking app, ANZ Plus has turned it off for customers – by default. 

There may be circumstances where customers legitimately need to share their screen, such as with family members. For these times – customers can turn it back on for a period of 15 minutes. This helps avoid accidentally giving access to your device to someone who shouldn’t have it.

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While there is a place for cryptocurrency – it’s not for everyone. The Australian Tax Office estimates just 600,000 taxpayers have invested in a cryptocurrency. This suggests a disproportionate amount of money is being lost to scammers via cryptocurrency scams. The Australian Financial Crime Exchange estimates half of all scam funds were directed to accounts associated with cryptocurrency exchanges.

To respond ANZ Plus has turned off the ability to make payments to cryptocurrency by default. This means if we identify a customer has tried to make a payment to crypto, it will be blocked. Of course, if a customer wishes to make a legitimate payment to crypto, they can – but only by disabling Crypto Protect and only up to $10,000 a month.

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ANZ Plus customers can also share additional information which is sent to Falcon, our unique fraud detection and prevention technology. This includes their location and if they are on a phone call while making a payment.

These enhancements are designed to pick up abnormalities in a customers’ spending or identify cases where they may be being ‘coached’ to make a payment via the phone.

By analysing these and hundreds of other data points, ANZ Falcon builds a unique picture of each ANZ Plus customer, learning from each of their transactions to offer personal fraud and scam protection.

What else can you do to help spot an investment scam?

When it comes to investments - if it sounds too good to be true, it probably is. If in doubt, don’t act.

Always conduct independent research regarding investment opportunities or speak to a financial adviser before making significant investments. Also ensure: 

  • Any person you are speaking with works for the organisation they say they do, using contact details you were able to source and verify
  • Any person trying to sell you a financial or investment product, or who is giving you financial advice, has an Australian Financial Services (AFS) license
  • The address and contact details for the company you are investing in are correct on publicly listed directories
  • You check the company’s share listing on the ASX or relevant stock exchange. If the offer to buy the shares is well below the market value shown – it is a scam. If you are told the shares are being released pre-initial public offering (IPO) be even more cautious
  • You check the date a website domain name was registered. A new website for an existing company is a red flag

We strongly suggest seeking independent legal or financial advice from a representative registered with ASIC. Do your due diligence to make sure you know where you are sending your money. Make sure the company or website is not named on the International Organization of Securities Commission's (IOSCO) investor alerts.

ANZ Plus’s customer protection teams and systems operate 24/7. Customers who believe they may have been a victim of a scam should contact a Coach via our in-app chat.

Gabe Steele is General Manager of Customer & Identity Services at ANZ

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

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