Did you know that investment scams cost Australians over $70 million in the first six months of this year? That is more than the total reported losses for all of 2020, with projected losses set to reach $140 million by the end of the year.
Data from Scamwatch shows a 53.4 per cent increase in reports about investment scams received so far, up from 3,104 in the first half of 2020 to 4,763 reports so far in 2021.
In addition to taking victims’ money, scammers often commit fraud or identity theft using the information they obtained from the victim.
More than half of the $70 million in losses were to cryptocurrency, especially through Bitcoin, and cryptocurrency scams were also the most commonly reported type of investment scam, with 2,240 reports.
Scammers pretend to have highly profitable trading systems based on individual expertise or through algorithms they developed. Many of these scams also use fake celebrity endorsements to try and enhance their legitimacy.
Victims are initially able to access small returns sourced from other victims’ initial deposits but the scammers soon claim problems with making withdrawals and cut off contact.