Investment scams are becoming ever more sophisticated, but you can uncover them within a few minutes – you just need to know what to watch out for. In this article we'll look together at 5 key steps that will keep you from being fooled. You'll learn to recognise fake investment platforms, forged articles, suspicious ads, and the tricks that scammers use to manipulate investors.
1. Who is behind it? Not a step without real people!
Focus on who talks about the investment platform and where – or rather doesn't talk about it. With reputable projects, the founders often appear publicly, give interviews, present their project at conferences, and openly stand behind it.
Scammers? They, on the contrary, hide the people behind it. If you can't find any names, any profiles of founders or employees, something is wrong.
How to do it? Open the platform's website, look at the "About us" section, try to track down its founders or employees on LinkedIn, and find out whether they have a real history. "I dare say you'll filter out 95% of investment scams with just this simple step – a few clicks on the website and LinkedIn," says the co-founder and CMO of InvestBay, Lukáš Přikryl.
Imagine that you receive an enticing offer to invest in a "super advantageous platform". What do you do first? You look at who is behind it. If you can't find any specific people, there are no real profiles, there are no investor references, and the company isn't active on social media, be careful.
"Fraudulent platforms often have only a few followers on social media and fake profiles with zero history. No one promotes the company, no one really works there. And that's a huge red flag," Přikryl warns.
The conclusion? If a platform conceals who runs it, or if anonymous people are hiding behind it, you'd better turn around. You'll save yourself money and stress.
2. Articles and media: Don't get caught out by fake news
You've successfully handled step 1. But even if you do find real people behind the project, that doesn't automatically mean everything is fine. You need to keep verifying – look at the reviews, licensing, history, and the ways investors are paid out.
Scammers often use forged articles that look as if they're from reputable media, but in reality have nothing to do with them. At first glance you may see the logo of CNN, iDnes, Seznam Zprávy, or another trustworthy website. But when you look more closely at the address bar, you find that you're not on idnes.cz, but on a strange website with a name similar to iidnes-zpravy.online and the like.
This isn't the website of the given media outlet, but a copy prepared by a scammer that just wants to seem credible and… rob you.
How to verify it?
- Have you come across an investment offer that you like? Try to look up information about the company yourself as well – ideally by other routes, from several relevant sources, and several times over. Did you also find interviews with the founders, articles about the platform on reputable websites like Forbes, Hospodářské noviny, E15, BBC? Excellent, it's not a scam. Otherwise, take to your heels.
And remember: Fraudulent pages are often almost indistinguishable from the real one, so examine the details. - Don't blindly trust an ad on social media. Verify – see point 1. Measure twice, cut once.
- Truly reputable investment companies don't appear in the media only as an ad. You'll find interviews, analyses, and reviews about them on trustworthy websites and magazines.
Beware: Online ads in the form of banners can unfortunately be seen even on reputable websites – the website itself doesn't have these things under control.
Reading tip: Is InvestBay a scam, or an innovative investment platform? Reviews and experiences
3. Fake celebrities
If you see Petr Pavel, Andrej Babiš, Petr Fiala, or another politician in an ad, take notice! None of them promotes investment platforms – their names are merely misused by scammers.
Yes, genuine collaborations with celebrities do exist, for example Petr Čech or Zlatan Ibrahimović promoted the investment platform XTB. With politicians, however, you can be sure that these are fake ads.
So if you see a well-known personality in an investment ad, look at their official pages or social media – if they say nothing about the collaboration, it's fake.
4. Exaggerated promises
On top of all that, scammers often lure people in with absolutely risk-free investments with a guaranteed high return. The reality? Every investment carries a certain degree of investment risk.
If an ad promises a secret investment, enormous profits, and a risk-free return, it's probably a scam. In reality the rule is: A high return always also means high risk.
Read more about this topic in our article: Understand investment risk for effective investing
Scams are often connected with shocking information, such as:
- A "secret energy source" that "will change the world"
- "The state is keeping quiet about an investment in gold/cryptocurrencies"
- "ČEZ pays out hidden profits to every citizen"
5. They can't be contacted? A big warning signal!
Reputable investment platforms always have a physical address, a phone number, an e-mail, and real contact persons. Even if they don't have a branch network, they have an office where people can be reached – at least by prior arrangement.
Scammers? They often list only a contact form or a non-existent phone number on the website. When you call, no one picks up.
How to verify it?
- Find a phone number or e-mail and try to contact support.
- Find out where the company is actually based – if you can't find a specific address, hands off.
- Try to look up reviews of the company – if most are negative or there are none, be cautious.
Bonus: What else to avoid?
Never install any remote access software! No legitimate investment company will want you to install an application for remotely controlling your computer, such as AnyDesk or TeamViewer. If someone wants you to, hands off!
Common sense above all
The best defence against investment scams? Use common sense and follow simple steps:
- Verify the people behind the project
- Look for genuine articles and information in reputable media
- Check the contact details and the company's registered address
- Don't be lured in by fake celebrities and exaggerated promises
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