Beware of Fake Celebrity Endorsements: The Rising Investment Scam
Author: Adam Collins
Celebrity endorsements have a powerful influence on our decisions, from the products we buy to the investments we make. Picture this: you’re scrolling through social media and see a familiar face—your favorite celebrity or a well-known “finfluencer” (financial influencer) endorsing an investment platform.
Unfortunately, scammers are exploiting this trust by creating fake celebrity endorsement ads on social media to promote fraudulent online investment schemes. Here’s what you need to know to protect yourself.
How the Fake Celebrity Endorsement Scam Works
Scammers craft social media ads that feature fake news articles appearing to come from reputable New Zealand media outlets. These ads often showcase a popular New Zealand celebrity with an eye-catching headline, making the ad seem credible and unrelated to investing at first glance.
Clicking on the ad takes you to a fabricated news article on a website designed to mimic a legitimate New Zealand news platform. The article describes a fictitious interview with the celebrity, who allegedly discusses how they made significant profits using a particular investment platform.
The article contains a link to the investment platform’s website, which usually deals in cryptocurrencies or forex. Here, visitors are prompted to sign up and provide their contact details. Shortly after registering, they receive a call from someone posing as a broker or financial adviser, who instructs them to make an initial payment of $250 USD or €250 to start investing.
To build trust, the scammers might ask victims to download remote access software such as “AnyDesk,” claiming it’s necessary to help manage the investments. The scammers may also transfer “profits” to the victim’s bank account, creating the illusion of successful investments and reinforcing the scam’s legitimacy.
Emboldened by these apparent profits, victims are encouraged to invest larger sums. The scammers provide dashboards to track these supposed investments, making the operation look sophisticated and real. However, when victims attempt to withdraw their funds, they are told they must first pay a substantial fee to release the money. They claim its taxes which must be paid before releasing the funds, But even if these fees are paid, no money is returned.
How to Protect Yourself From Investment Celebrity Scams
As always, there is always something you can do to protect yourself and your money from scammers. Here are a few pointers;
- Exercise extreme caution with social media ads featuring celebrities promoting investment opportunities. Always verify the authenticity of such endorsements by cross-checking with official sources or the celebrity’s verified social media accounts.
- Do not click on these ads or share your personal information. If an offer seems too good to be true, it probably is.
If you have already shared your details and been contacted by a scammer, stop all communication immediately and do not send any money. - Scammers are skilled at manipulating emotions and creating a sense of urgency, so take a step back and assess the situation critically.
- If you’ve allowed someone to install remote access software on your device, seek advice from an IT professional immediately. This software can give scammers control over your device, potentially leading to further fraud or data theft.
- Report the scam to the appropriate authorities. In the US, you can share with the Federal Trade Commission, in Canada, share with Canadian Securities Administrators, in New Zealand, share the details with the Financial Markets Authority or you can report scam here at ScamAdviser. Sharing your experience can help prevent others from falling victim to the same scheme.
Above all, keep your wits, and if a deal sounds too good to be true, it probably is irrespective of who is advertising the deal. In the wake of Deepfakes and Artificial Intelligence, users need extra caution to be able to beat the scammers.
The Financial Markets Authority lists the following websites as potential scams
- www.trade212.ai
- www.trade101.ai
- www.cg-markets.com
- www.schwabeuinvesting.com
- www.lplinvesting.com
- www.capitagains.com
- www.precisiontrade.io
Image Source: Unsplash.com
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