Barclays data reveals a 29% increase in investment scams in 2023
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
A recent report published by the UK bank Barclays revealed that the financial world saw an increase of 29% in investment scams conducted last year. The scams have hit the bank’s current account customers quite hard, and they represent the highest proportion of money lost to scammers. The report puts the average claim figure above £14,000.
The average victim of investment scams last year lost more than £14,000, Barclays warned https://t.co/DnBLZktjzv 🔗 Link below pic.twitter.com/uWSQLHOjXh
— Gazette & Herald, Ryedale (@gazetteherald) April 17, 2024
More than half of all investment scams take place on social media
Barclays’ report revealed that around 6 out of 10 investment scams nowadays tend to take place on social media platforms. This is possible because fraudsters use these platforms to promote unverified financial ads in order to lure unsuspecting victims.
Furthermore, Barclays points out that Millennials are the most affected, particularly Millennial men. Their average investment scam claim rose to £16,306, according to the report. Meanwhile, those between the ages of 21 and 40 account for almost half of all those who lost their money to investment scammers last year.
Barclays’ Head of Fraud Strategy, Stephanie Mac Sweeney commented on the report, stating that it is worrying to see such a massive rise in investment scams. She added that the victims are often heatlessly scammed out of large sums of money that they were saving for their future. Instead, that money got taken by fraudsters.
Furthermore, she added that the banking industry is doing everything in its power to combat scams, but its impact is limited, given that the scams take place elsewhere. With that being the case, the only real solution can come from targeting the source of the scams.
In other words, Mac Sweeney said that social media companies must take responsibility and create a robust verification system that would protect their users from fraudulent investment ads.
Barclays’ three tips for protecting yourself from scams
Until social media platforms make their move, Barclays offered three tips for identifying investment scams. The first one is for users to stop before committing to any investments, and think things through. They should also be wary of offers that sound too good to be true. Finally, they should thoroughly investigate any investment opportunity they are presented with.
Usually, scammers would try to deny them the time to stop and think, urging them to rush and invest “before it’s too late.” This is also a red flag, as urging users to act prevents them from thinking things through.
It is also worth considering the data from the FCA’s consumer helpline, which further highlights how serious investment scams have grown to be. According to the regulator, investment scam-related phone calls skyrocketed by 193% in the last five years.
The regulator also set a new record by issuing 2,286 scam warnings on its Warning List in 2023, which represents a 21% increase from the number of warnings issued in 2022, which was 1,882.
