Donegal TD Pearse Doherty has called for new policies to tackle investment scams and financial fraud.
This comes as FraudSMART warns of the worrying rise in investment scams being carried out by fraudsters.
The scams are highly convincing, appear to be legitimate, but are in the fact the work of fraudsters. Brochures using the names and branding of well-recognised, legitimate bonds and investment schemes are being circulated by fraudsters and advertised online.
“Initial indications suggest that the scams are particularly targeted at those in the over 55 age bracket with a minimum investment of €20,000 and in many cases upwards of that,” FraudSMART warns.
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.
Teachta Doherty said: “We need to ask when online platforms and social media companies will take responsibility for the fraudulent content that is being advertised on their platforms and robbing citizens of thousands of euro.
“There is no requirement for online platforms and social media companies to pay compensation to victims of fraud – that needs to change.
“There is also no requirement for payment service providers to pay compensation to victims of authorised push payment fraud.
“And we have no system to cross-check the name of the person victims send their money to against the name on the actual account.
“This is called Confirmation of Payee and has been introduced successfully in Britain and the Netherlands to reduce fraud.
“These are actions that can be introduced to protect potential victims of scams and fraud.
“It is time to give this issue the attention it deserves.”
FraudSMART is calling on the public to stay informed, alert, and secure and follow the tips below.
Red flags to look out for:
- You are cold-called about an investment opportunity – i.e. you receive an unexpected telephone call/e-mail/social media message.
- You are rushed and pressured into making a decision there and then, with no opportunity or time to consider the details of the investment.
- There is a promise of a quick and profitable return on the investment with little or no risk.
Checklist to avoid investment scams:
- Stop and think: Does this opportunity sound too good to be true? If so, it probably is.
- Take your time: Important to note that there are very few legitimate investment opportunities that require you to hand over or transfer money immediately.
- Research thoroughly: Check the individual and firm for qualifications, credentials, reputation and history. The Central Bank Consumer Hub is a good place to start.
- Verify the Information: Check all information with a trusted third party such as a legal/financial professional and consult family and close friends.
Further information on investment scams and other fraud types can be found on the FraudSMART website www.fraudSMART.ie.