Cryptocurrency is a scammers’ paradise – AJ Bell comment

Laura Suter
21 May 2019

•         Victims lost more than £27m in forex and crypto scams last year
•         The number of scams reported trebled 
•         Scammers are using ‘get rich quick’ lures to draw investors in

Laura Suter, personal finance analyst at investment platform AJ Bell, comments on the FCA and Action Fraud’s scam figures:

“Cryptocurrency is a scammers’ paradise, as many people ‘investing’ in these assets do little research and are sucked in by the promise of supersized returns in an impossibly short space of time. Using social media and the lure of expensive products to draw people in, scammers have made a fortune off their victims.

“Research from the FCA earlier this year found that people went into cryptocurrencies for all the wrong reasons, and getting rich quick was one of the main motivations for buyers – so it’s not surprising that scammers are capitalising on this. The scale of the losses are massive, with the average victim losing £14,600, and in many cases those victims will also have persuaded friends and family to invest too. 

“Anyone handing over their hard-earned cash should make sure they understand what they’re getting into, they’ve checked it’s a legitimate investment, and not rely on hype and excitement from friends or social media. Investing isn’t a get rich quick scheme – and anything that uses FOMO or requires you to invest before thinking is best to be avoided.

“Anyone who is thinking about investing in something should carry out a few simple checks before parting with their money. If someone calls you out of the blue – hang up, and if the returns sound too good to be true, they probably are. Don’t be lured in by an impressive-looking website or any celebrity endorsements, and if your friend recommends something to you, don’t assume that they’ve done all the research for you. Finally, you can check on the regulator’s register to see if the company is legitimate.”

Laura Suter
Personal Finance Analyst
Laura Suter is personal finance analyst at AJ Bell. She is a multi-award winning former financial journalist, having specialised in investments. Laura joined AJ Bell from the Daily Telegraph, where she was investment editor. She has previously worked for adviser publications Money Marketing and Money Management, and has worked for an investment publication in New York. She has a degree in Journalism Studies from University of Sheffield.
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