Tips For Avoiding Bogus Investment Scams And Fraud


Consumer watchdogs have launched a Twitter campaign warning investors about scams and fraud.

The Financial Conduct Authority (FCA) has published some tips on how to avoid bogus investment cons as part of the campaign.

Some tell-tale signs of an investment scam include the promise of a higher than average return or tax advantages.

Scammers will also hint they have inside information they are sharing – but if they had they would keep the details to themselves to make more money.

“Be wary of fraudsters making unexpected contact after lifting your phone number or email address from databases that are publically available. Like shareholder list, phone books and the internet,” said the FSA.

“Take this contact as a warning sign not an opportunity because you could lose all the money you hand over.”

Here are some of the FCA’s top tips –

  • Just say ‘No’ and keep saying it – Unregulated firms do not cold call. Simply hang up
  • Take positive action – sign up for the Telephone Preference Service and Mailing Preference Service to cut sales calls and junk mail
  • Check out your adviser – regulated firms are listed on the FCA register
  • Ask callers for their Financial Conduct Authority Registration Number or ‘FRN’ and check they are not a bogus firm on the FCA register
  • If the firm is not on the FCA list, check the list of unauthorised firms. The list includes bogus firms listed by some foreign regulators
  • Don’t give any money to an unauthorised firm – the cash will not be safeguarded under the Financial Ombudsman Service or Financial Services Compensation Scheme if the deal goes wrong.
  • Get a second opinion from an authorised adviser
  • Scammers double dip – if you have fallen for one fraudster, another is likely to get in touch soon after
  • Report the scam to the FCA

Find out more on the FCA web site

Unregulated firms posing as bogus financial advisers

Here is a list of warnings published by the FCA this week:

Dealing with an unregulated firm

If you buy shares, save money or invest with an unregulated firm, you lose any protection offered by the Financial Ombudsman and the Financial Services Compensation Scheme. Broadly, you have no independent place to complain if the deal goes wrong and are unlikely to win any compensation.

Checking if a firm is regulated

Go to the Financial Services Register to check if a firm is regulated in the UK.

Reporting a suspected bogus adviser

Find out how to report unauthorised advisers on the FCA web site


Download the Free Pension Transfer Guide

Expat Pension Transfers Guide expert writers have created a simple guide to Expat Pension Transfers just for you.

Find out how you could save tax, increase growth and investment opportunities with this simple, no-nonsense guide that will introduce QROPS, SIPPs and QNUPS options and talk through the pros and cons. Download the free guide by following the link below

Leave a Reply