Brits who are keen to make more money by investing have been issued a warning from Lloyds Bank.
The alert comes after a series of investment scams which have seen savers lose as much as £31,000. Lloyds said victims aged 18-24 are most likely to be conned, though people of all ages have fallen for the scams.
On average, those who tricked by such scams are forced to part with almost £9,000. Young investors, Lloyds said, are being lured by fake crypto and "meme" stocks - where shares in a company that has gone viral quickly increase in value as a result of its popularity, rather than its financial performance.
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However, the biggest increase in those reporting investment scams over the last 12 months came amongst 35 to 44 year olds, with cases jumping by more than half (52%) compared to the previous year. Those aged 25 to 34 saw cases rise by almost a quarter (24%) over the same period.
Older victims, the banking giant said, are likely to lose much more of their hard-earned cash. Victims aged between 65 and 74 lost an average of £30,397, with 18 to 24-year-olds losing £1,433 on average, and those aged 25-34 losing £2,410.
Financial markets are increasingly volatile in the run-up to the end of the current tax year. Lloyds Bank is now warning potential investors that scammers will go to any length to trick victims into parting with their cash.
Liz Ziegler, retail fraud and financial crime director at Lloyds Bank, said: “Investing can be a great way to make money, but many deals are simply too good to be true, and it takes hard work and lots of research to find the right investment for your circumstances.
“The organised criminal gangs behind scams are constantly evolving their tactics to exploit new trends and trick more victims into parting with their cash. Recently we’ve seen them widen their net to target younger investors, who are often tempted by the supposed "get rich quick" promise of cryptocurrencies and meme stocks.
“While older investors remain at high risk – and often stand to suffer much heavier losses – there’s now a new generation of younger, more inexperienced investors on the scene for scammers to target. Predictably, our analysis suggests that social media platforms are the main breeding ground for these types of scams, with a mix of bogus ads, fake endorsements and cloned accounts key to fraudsters’ methods.”
Lloyds Bank has issued three "top tips" to avoid investment scams. These are:
Great deals don’t find you
Fraudsters put adverts for scam investments on social media and the internet. They can also send ‘deals’ by direct message, over the phone or by email.
Often, a deal will offer returns that you can't get elsewhere. If someone contacts you out of the blue about an investment, it’s most likely a scam.
Make sure it's genuine
Scammers can easily set up fake companies, profiles and websites to clone real firms. Use the FCA website to find genuine contact details for a company and links to their site.
Always do your own research but also see what other people have to say in reviews. Never underestimate the lengths a scammer will go to, to convince you an investment is genuine.
Protect how you pay
A scam investment may ask you to pay by bank transfer. If you pay this way and it’s a scam, it’s very hard to get your money back. Fraudsters might ask you to pay an account in a different name to the company you are meant to invest with.
If the names don’t match, it’s a sign of a scam. Paying by card offers the greatest protection.
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