Barclays Issues Warning Amid Surge in Investment Scams

Barclays has issued a crucial warning to its customers regarding the heightened risk of losing substantial sums of money to investment scams, which accounted for a third of all monetary losses to scammers in 2023.

This surge is attributed to scammers exploiting the ability to promote unverified financial advertisements on social media platforms, with over 60% of investment scams now originating from these channels.

According to Barclays, the average victim of investment scams in the past year incurred losses exceeding £14,000, more than five times the average for victims of other scams.

Scammers typically employ a common tactic of enticing victims to initially invest a small sum, which purportedly yields high returns funded by subsequent victims’ investments. This deceptive practice often dupes victims into believing in the legitimacy of the investment, leading to larger losses over time.

Stephanie Mac Sweeney, Barclays’ Head of Fraud Strategy, expressed concern over the rising prevalence of investment scams, highlighting the devastating financial impact on victims who lose substantial sums earmarked for their future.

Mac Sweeney emphasised the necessity for social media platforms to assume responsibility and implement robust verification systems to combat fraudulent investment advertisements. She stressed that targeting scams at their source is crucial for effecting real change in addressing this issue.

Barclays outlined key steps to identify investment scams:

1. Stop: Avoid impulsive decisions spurred by false urgency often created by scammers.

2. Think: Exercise caution if an investment offer appears too good to be true, especially on social media platforms. Seek advice from a qualified financial advisor or trusted family member.

3. Investigate: Verify the legitimacy of investment opportunities by checking if the individual or organisation is authorised by the Financial Conduct Authority (FCA). Conduct independent research and seek unbiased reviews of the investment opportunity under consideration.

Barclays encourages individuals to remain vigilant and take proactive measures to safeguard themselves against falling victim to investment scams.