The Australian Securities and Investments Commission (ASIC) is warning people to be careful of WhatsApp invitations to investment tip groups as scammers are increasingly using them to encourage investments on fake cryptocurrency trading platforms.
The scam uses social media advertisements and posts whereby individuals are invited to join WhatsApp groups for share trading tips. Scammers then recommend fake cryptocurrency trading platforms they have established. The platforms have been made to look authentic, with a screen showing profits and trades, but in reality no real trading takes place and the display is a front.
The fake platforms then ask for fees if investors want funds released. The scammer subsequently pockets those fees and keeps the assets.
The corporate watchdog is aware these scams increasingly target young people, with recent Moneysmart research finding 23 per cent of Australians between 18 and 28 own cryptocurrency.
Further, close to one-third, or 29 per cent, of this cohort confirmed they conduct short-term trading based on social media influencers and 72 per cent said they have seen ads about cryptocurrency.
In addition, 41 per cent of respondents indicated they have been contacted by someone about cryptocurrency investing.
ASIC pointed out businesses providing digital asset services, such as cryptocurrency, must be registered with the Australian Transaction Reports and Analysis Centre (AUSTRAC) and comply with relevant regulations. People can check if a business is registered with AUSTRAC at its Virtual Asset Service Provider Register.
The regulator’s consumer education website, Moneysmart, also has a ‘Check before you invest’ page, which it encourages people to visit before deciding to invest in cryptocurrency.
Moreover, ASIC has reminded people who have fallen victim to this scam and cannot retrieve funds on a platform to access the Moneysmart ‘What to do if you’ve been scammed’ feature.
However, it warned individuals to be aware of many recovery scammers as well who pretend to offer assistance in retrieving funds without producing a result.
