What? But that's too good to be true

Tara Gillespie

Sometimes the signs are easy to spot. You receive an email that starts “Dearest XYZ” and proceeds to ask you to transfer money to help a long lost great uncle’s ex girlfriend’s dog’s walker. You delete then and there… Unless you are Joe Lycett and you build a comedy career over replying and having ridiculous conversations with these fraudsters. 

What about those people who speak to you about a great opportunity to get invested today to make great returns with no risk. They look professional. It sounds legitimate. Especially in the current low interest environment when everyone else is earning next to nothing on their savings accounts… Why not listen to what they have to say?


If it sounds too good to be true, it definitely is! 

Last week The Times reported a 49% increase in investment scams between June and July. People are looking to take advantage of concerns over low interest rates to encourage people to invest in dodgy private companies, cryptocurrency and other unregulated investments. 

How do you know if it’s a scam? 

  1. If they are offering a guarantee - there are no guaranteed returns in investing. Simple as. You have to take some risk to generate a return (although there are ways of managing that risk so if you are interested in hearing more about that head here).
  2. They aren’t a regulated advisor - financial education and guidance should be totally impartial and not lead to a specific investment. Only regulated advisors should be recommending a specific investment option. If they aren’t regulated be very careful!
  3. (Often) a referral - this is a grey area. Obviously being referred to things by someone you trust can be a safe option. However, you need to understand what’s in it for them. If they are doing it out of the goodness of their hearts then it’s probably honest. If they are getting a financial incentive to refer you then BE CAREFUL! As above, get a second (and third) opinion. Pyramid schemes are less common these days but they are trouble.

Not your fault, you were scammed? The banks might not see it that way and you may not get reimbursed for the losses. So take care and know the facts! When in doubt, ask for a second opinion! Friends, family, financial advisors or the Best Intentions team are always here to help!