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Aussies to lose $100m to fraudsters

Investment scams robbed Australians $65 million last year and are tipped to lose up to $100 million in 2021.

This is according to Finbold, which found that investment fraud was the number one scam that prey Australians.

Dating and romance scams (23%) were the next most prevalent. False billings (11%) are the third-most common scam that rakes in $19.32 million for fraudsters, followed by life threats and arrests (7%,) and remote-access scams (5%).

"The different forms of scam losses are likely to keep surging as fraudsters exploit new avenues to mint money from victims. With the pandemic not yet fully contained, more people will still turn to digital platforms for managing finances," Finbold said.

Other scams include online shopping ($7.4m), health and medical products ($3.9m), identity theft ($3.1m) and unexpected lottery wins ($1.7m).

The huge loss signals that investment fraud might keep surging, corresponding with the year-over-year growth trend, Finbold said, adding that between 2018 and 2020, investment scams jumped 67%.

"In the wake of increasing scams, there have been efforts to sensitise consumers to be on the lookout," Finbold said.

Investment management giant Vanguard was recently targeted by scammers, who bought advertisements on search engines for terms relating to "bond or high yield investments".

When investors click on the ad link, they are taken to a fake investment comparison website with a name like "Investment Compare".

Investors' personal information including identification and bank details, followed by in-person contact and provision of a fake Vanguard prospectus designed to convince victims to purchase non-existent investment products.

The Australian Financial Complaints Authority alerted consumers of the spike in finance-related scams, which made up 23% of the 34,047 new complaints in the six months to 30 December 2020.