Irish consumers are being warned of a sharp rise in “highly convincing” investment scams involving fake product comparison websites and brochures using the branding of well-recognised bond and investment schemes.
Fraudsmart, the fraud awareness initiative led by the Banking and Payments Federation of Ireland (BPFI), is telling people to be sceptical if approached about investment opportunities that sound too good to be true.
Niamh Davenport, head of financial crime at the BPFI, said that while the scams are particularly targeted at those aged over 55, anybody can fall victim to fraudsters if they’re not on the alert.
She said that the minimum investment in most cases has been €20,000 and “in many cases upwards of that”.
“While the amounts may seem high it’s important to point out that the victims are not necessarily wealthy customers, but often people on low to average incomes who have worked hard all their lives to build up a pension and are at a stage where they are looking for a last opportunity to top up their finances ahead of retirement,” Ms Davenport said. “In one reported incident an older customer was about to invest €60,000 from their pension into what appeared to be a legitimate scheme. Fortunately, the customer made a call directly to their bank before pushing the payment through and this meant that the fraud was identified and averted.”
She said that the fraudsters often hide behind product comparison websites that appear to be legitimate. Some people have been also been approached by cold-callers or through unsolicited emails, texts and social media messages.
The BPFI is asking consumers to be wary of anyone cold-calling about an investment opportunity, particularly if there is a promise of a quick return with little or no risk.
In general cold-calls about an investment opportunity are also a “red flag”, the industry body said.
“I think we would all like to believe that we would recognise a scam if we saw it, but the truth is any of us can fall victim to fraudsters if we’re not on the alert,” said Ms Davenport. “It is really important for consumers, particularly those coming close to or at retirement age who are a key target group right now, to be aware that the scams offer very convincing investment opportunities and once the money is ‘invested’ it disappears with no redress once the money is handed over to an unregulated ‘firm’.”
She said: “The rule of thumb is ‘if it looks too good to be true it probably is’.”
