Better Business Bureau: Investment Scam Losses Rising
Investment scams are becoming much more costly for seniors and others duped into believing they are getting incredible returns, the Better Business Bureau (BBB) warns.
“It can feel like you’ve hit the jackpot – and then it comes crashing down when you realize your golden ticket to financial independence has turned into overwhelming debt or the loss of your life’s savings, because it was a scam,” said Heather Massey, vice president of communications and community relations.
Through blending long-term romance or confidence scams and integrating cryptocurrency capabilities, median losses to investment scams have increased from $1,000 in 2021 to almost $6,000 this year, according to a BBB study released in September.
The research focused on investment scam tactics and impacts during the past three years and included many first-hand accounts describing losses in the hundreds of thousands of dollars withdrawn from retirement and savings accounts.
Social media and internet messaging applications are the primary method to initiate a cryptocurrency investment scam with over 60% of reports to BBB Scam Tracker indicating these platforms were used.
BBB’s 2023 Scam Tracker Risk Report identified investment scams as the No. 1 riskiest scam North American consumers encounter. In Texas, residents have reported $2.1 million lost to these schemes in 2024.
“The first-hand accounts and insights provided in this report will go a long way to helping experienced and new investors recognize the red flags of fraud,” Massey said.
Watch for these red flags:
• The investment strategy is guaranteed to generate massive returns.
• The opportunity is offered as a secret or leans on an online romance (e.g., “You should invest in X-Y-Z so we can get married,” or “I’m only telling you about this because I love you.”)
• The trader or contact becomes aggressive or insulting if their recommendation to invest more money is refused.
• The return can only be accessed after paying excessively high service, tax, or processing fees that were previously undisclosed.
Visit BBB.org/ScamStudies to learn more.
