Don’t Fall For Investment Scams – Not All Lobangs Must Share!

Don’t Fall For Investment Scams – Not All Lobangs Must Share!

6 min read

Beware of deals that are too good to be true.

The other day, Dad came excitedly to me and started telling me about this investment opportunity that is “guaranteed to double your money!”

Being a natural skeptic, I looked up the company on the MAS Investor Alert list and sure enough, it had been flagged as an unregulated entity. I showed it to Dad and his face dropped in shock. “Wah, jialat! I better call your cousin right away!” he said, and quickly hurried away.

Investment scams like these are an all too common occurrence nowadays, and scammers don’t just stop at cheating innocent people – they get them to share these “lobangs” with their friends and family, making use of the trust in their relationships to make the deals seem more credible. According to the Singapore Police, investment scams in Singapore have seen a 126 percent increase to 1,102 cases, with losses of at least S$69.5 million between 2019 and 2020.

A common target of these scams are seniors who may not be financially savvy and are sitting on a considerable sum of retirement savings. How can you protect your loved ones from these schemers? Here are some telltale signs to look out for that can help you spot a potential scam:

No such thing as confirm win, OK

If anyone comes to you with an investment scheme that promises high returns at low/no risk, please run far, far away. All investments carry some form of risk – the higher the promised return, the higher the risk. Be very careful with schemes that claim to protect/guarantee your capital and deliver high returns. It’s simply the scammer’s way to lure you in with the temptation of lucrative promises.

“Limited time only! Wait some more the chance gone liao.”

Unicorn piggybank representing unicorn investment scams

Unicorn investments aren’t that easy to find - don’t rush to put all your money in! | Image source: Unsplash

Pressure tactics like the above are one of the ways scammers get you to rush into a decision. These include limited offers and timed rebates to entice you to commit your money. Always ask yourself if you fully understand what you’re buying into – when in doubt, it’s always safer to walk away with your money intact.

“Shhhh! Don’t tell anyone.”

Another common way scammers get you to buy in is by framing it as an “exclusive offer” that is “by invitation only.” They may even ask you to keep quiet about it and not tell anyone, so that you feel like it's a privileged deal. Stay level-headed and be very careful about making any hasty decisions!

Getting you to rope in the whole kampung

Some investment scams will incentivise you to bring in your friends and family, so as to quickly enlarge their base of investors. Legit investment schemes will generally not offer commissions for referrals, so beware of anyone who does so.

“This could be you, bro!”

Scammers often use fake testimonials and “success stories” of customers who have made money from their investments to make the schemes sound more credible. They also claim to have impressive track records, with many years of experience and won many accolades. Always approach such “credentials” with skepticism, and do your due diligence by verifying their claims with an independent third party. 

So many scams, how to protect myself?

Safekeeping your money from investment scams

Keep your money safe - don’t be in a hurry to give it to scammers! | Image source: Unsplash

Not all investment schemes out there are scams, but it’s always good to do your homework before proceeding with any financial commitments. The Singapore Police Force provides a handy 3 point checklist of Ask, Check and Confirm:

  • ASK as many questions as you need to help you fully understand what you are investing your money into.
  • CHECK on the company and its management to ascertain if the investment opportunity is legit.
  • CONFIRM the credentials of the company and its representatives using resources like the Financial Institutions Directory, Register of Representatives and MAS Investor Alert List.
Reporting scams through phone call

Keep your money safe - don’t be in a hurry to give it to scammers! | Image source: Unsplash

I think I kena scam already, how ah?

The important thing is to stay calm and not panic – if you’re not thinking clearly, you could make the situation worse. Some things you can do are:

  • Report the scam by calling the anti-scam hotline on 1800-722-6688. Even if you only suspect a potential scam, you can also call this helpline.
  • Contact your bank or financial adviser as soon as possible to alert them of the scam. If you act quickly enough, the bank may be able to help you block the transfer.
  • Alert your family and friends, so they do not fall for similar scams.
  • Seek legal advice to try and recover your money. A specialist investment fraud lawyer will have the knowledge and skills to identify sophisticated scams, and advise you on the legal options available to you.

If it’s too good to be true, it usually is

Many victims of investment scams fall prey to such schemes due to the temptation of easy money and huge profits. Legit opportunities do exist out there, but be wary of those who lure you in with attractive and “guaranteed” promises. Always do your due diligence before committing to any form of investment!

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