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FCA ramps up warnings over online investment scams

The FCA is warning the public to be vigilant protecting themselves from online investment fraud, with figures showing investors lost an approximate daily amount of £87,410 to binary options scams last year.

Latest data from the FCA’s Scam Smart campaign shows the kind of investor being targeted by online investment scams is changing.

The regulator says those under 25 were six times (13 per cent) more likely to trust an online investment offer made via social media than people aged above 55.

The data shows more than one in five (23 per cent) survey respondents say online customer testimonies and reviews increase their trust in an investment company.

A further one in 10 (11 per cent) say they wouldn’t conduct any of the listed checks at all, such as checking whether the firm was regulated by the FCA or registered with Companies House, before parting with their money.

FCA issues warning on fake regulator legitimising scam

FCA director of enforcement Mark Steward says: “As people have become more sceptical of investment-related cold calls and consumer habits have changed, we have seen investment fraud moving online and to social media.”

He adds: “While their websites and profiles appear to be professional, they are all too often run by fraudsters who fix prices and pay-outs.”

Hargreaves Lansdown policy head Tom McPhail says investors need to be savvy on recognising unregulated firms.

He says: “The whole investment community including legitimate firms, the regulator and investors themselves must remain alert to the risk of fraudsters trying to separate ordinary people from their hard-earned cash.”

On 3 January, binary options became a regulated investment product, which means all firms trading in these products need to be FCA authorised.

The regulator has since published a list of 94 firms without FCA authorisation that it understands to be offering binary options trading to UK consumers.

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  1. Binary options investment scam almost cost me my life last year. I’m glad I was able to recover my initial investment. Its been quite an experience. I’m open to share. mwraith990atGmaildotcom

  2. I was contacted by Skyline Markets in May last year. I didnt know much about trading and I was hesitant at first but the broker convinced me that I didnt need much experience, and he said that he would guide me and teach me. At first, my trades were working well and I felt like I was really learning and picking up things fast. During a period of about 8 months I made deposits to my trading account totaling $70K. In January this year, my account balance reflected over $290K. I felt that I had done well and I wanted to withdraw some of my earnings to treat my family to a holiday. My broker told me that I would need to pay brokers commission before my cash could be accessed. I had already purchased flight tickets on my credit card and I was relying on my investment to pay this back, so sure that it was my money. I felt forced to taking out an additional loan to cover the brokers commission of $9,400. After I paid this amount to Skyline Markets, it became literally impossible to get hold of my broker. A senior broker eventually responded to me and said that I would not get my funds because I had signed bonus agreements. I was not aware of the consequences of this at the time. I did some research to investigate the legalities of this. It was really the first time I became suspicious, and it hindsight I cant believe it took me so long to realize I was being scammed. I was in total dismay to find out that I, along with many others, was a victim of Skyline Markets. I would be in very serious financial trouble now if I had not found help through a mutual friend by hiring Geminihacks -.- com to help me recover my funds including profits made within a week thank you so much guys.

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