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Important: Be aware of these sophisticated investment scams [with examples]

Back in June, we reported that fraudsters were capitalising on the uncertainty and market turmoil caused by the coronavirus pandemic. Action Fraud reported victims had lost more than £4.5 million with more than 2,000 people affected.

Andrew Tully, technical director at Canada Life, said: “The Covid-19 pandemic has provided a fertile opportunity for lowlifes to prey on not only the vulnerable but also people who are worried and anxious about both their health and their wealth.”

With scams becoming more and more sophisticated, it’s vital that you remain vigilant. Read on to find out how you can stay safe.

Beware of sophisticated investment and pension scams

In recent weeks we have been made aware of several investment scams designed to con you out of your hard-earned savings or pension fund. These are often branded to look like genuine offers, from the likes of trusted names such as Prudential or Fidelity.

Recently, investors have received a fake email from someone purporting to be a Prudential senior investment manager offering a ‘guaranteed interest payment’ bond. Experts say it is one of the most sophisticated scams ever seen in the UK.

The scam, which claims to be a product called the Prudential Fixed Interest ISA RMA Bond, promises guaranteed returns of 3.5% per annum on a five-year fixed basis.

This document is branded with the Prudential logo and so appears genuine. It even uses a fake FCA registration number, email address, phone number and even a comment from Pru’s group CEO Mike Wells.

This particular scam was uncovered when a northern IFA alerted the authorities after he was contacted by a client set to invest £150,000 in the product.

5 common signs of scams

Scams are increasingly looking like legitimate investments, so it’s vital that you remain vigilant. Other common signs of scams include:

  • Claims about high or guaranteed returns
  • Being contacted out of the blue, or ‘cold-called’
  • The use of phrases such as ‘free review’, ‘guaranteed’, ‘take your pension early’ or ‘loophole’
  • Time-limited offers that require you to make a quick decision
  • Overseas, unusual or high-risk investments.

If something looks too good to be true, it probably is. Always speak to us before committing.

Get in touch

If you’ve been offered an investment opportunity, always check it is genuine before signing up or committing any money. There’s lots of useful information on the Financial Conduct Authority’s ScamSmart website.

If you have any doubts about the validity of an investment, please get in touch with us first. Email hello@sovereign-ifa.co.uk or call 01454 416 653.

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