The UK financial watchdog is warning Britons of a new generation of unchecked money managers that are using flashy social media profiles to trick them into thinking they can trade online and make thousands in no time.
The most recent addition to the FCA’s warning list is Investing4You Ltd, which operates the website https://investing4you.co.uk, as well as two associated handles on Instagram and Facebook. The Financial Conduct Authority, however, didn’t take further action.
The regulator explicitly points out that Investing4You is promoting speculative and risky trading products and that investors could lose their entire investment.
As of the time of publication, Investing4You profile has taken down all posts though it’s not clear if the page was removed as a result of the warning or leading up to it. Cashed versions show these pro-claimed traders post pictures of jet-setting lifestyle, including sports cars that they gained from trading forex and claim subscribers can do the same if they ‘follow their signals’.
While these bogus profiles advertise get-rich-quick schemes, they often operate solely on social media channels, including Instagram, Facebook, or WhatsApp.
These traders, however, do not have the necessary accreditation or qualifications to offer these services, though they promise very lucrative and guaranteed returns. All fake promises tend to stop after victims have invested money and got their first round of profits, the Financial Conduct Authority warns.
Between October and February, the City authorities spotted over 350 social media scammers, with the average person losing over $10,000, according to a notice on London police’s Action Fraud team website.
Earlier in March, the FCA warned that fraudsters are taking advantage of the coronavirus scare, and some of their scams are a direct threat to local investors. The Financial Conduct Authority also said that there are hackers in the background, trying to take advantage of trending topics in the news.
On its part, the City watchdog has identified different scams infiltrating Britons’ email inboxes, including insurance policies, pensions transfers, and high-return investment opportunities, as well as for cryptocurrencies.
Officials urge potential victims to check whether these providers are selling a financial product without the required authorization from the regulator.