How to protect against investment fraud?

09 April 2019

Ever more scammers are attempting to offer fraudulent investment services. By simply using the name of an existing company, it’s becoming increasingly difficult to expose the fraudsters. FSMA, the watchdog of the financial sector in Belgium, is sounding the alarm and warning of severe consequences.

Ever more scammers are attempting to offer fraudulent investment services. By simply using the name of an existing company, it’s becoming increasingly difficult to expose the fraudsters. FSMA, the watchdog of the financial sector in Belgium, is sounding the alarm and warning of severe consequences.

 

Number of victims rising in the financial sector

An increasing number of companies in the financial sector are falling victim to identity fraud. Typically, scammers will clone a financial organisation’s identity, then use that identity to approach consumers and other companies. The fraudsters refer to the official FSMA website, which of course clearly lists that the organisation is officially licensed. But in reality, you’re dealing with an imposter organisation. The ease behind this kind of operation is precisely why we should be concerned.


Investment fraud is not just a problem in Belgium, but all across Europe. It’s no wonder that AFM (The Netherlands Authority for the Financial Markets) has called for a broader European approach. The Dutch watchdog for the financial sector believes that collaboration between European countries makes it much more difficult for investment fraud and other kinds of financial scams to take place.

 

Investment fraud

Identity theft is a common element in all forms of investment fraud. Even so, the FSMA has discovered that particularly cryptocurrencies are vulnerable to identity fraud. A warning to be extra aware when purchasing these ‘online’ currencies: many crypto platforms, promising simple and lucrative ‘golden’ investments, are actually fake. The FSMA stresses that “Their offerings are pure deception.”

 

Solutions

Company and consumer checks are increasingly important, especially in areas that are sensitive to fraud. Without a solid check for companies and consumers, it’s impossible to guarantee that you’re doing business with a trustworthy party. Do you wonder how these checks can be of value to your company? 

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