The Australian Securities and Investments Commission (ASIC) has warned investors to be vigilant about investment tips received through social media and messaging apps using fake celebrity endorsements and impersonations of financial institutions.
According to the corporate regulator, these activities involve pump-and-dump scams whereby individuals are initially encouraged to join a messaging group in which scammers provide stock tips aimed at artificially inflating the price of a share. Once the stock price increases, the scammers sell the equities in question, triggering a fall in their prices and leaving victims with significant losses.
Many of the schemes attempt to achieve authenticity through the use of identities and images of well-known finance industry figures, including respected market commentators and economists.
ASIC chair Sarah Court noted this activity is causing investors substantial financial harm.
“These scams are becoming increasingly sophisticated and scammers are exploiting the trust Australians place in recognised experts, financial institutions and investment brands by faking their platforms and endorsements,” Court said.
“If you’re receiving stock tips through WhatsApp, Telegram or another messaging service, particularly after responding to a social media post, you should assume it’s a scam.
“The reality is that legitimate investment opportunities do not come from strangers on messaging apps pressuring you into buying shares.”
The corporate watchdog pointed out the scams are mainly targeting older Australians.
“We suspect scammers are deliberately targeting Australians nearing retirement because they know many people in this age group have accumulated retirement savings and are looking for investment opportunities,” ASIC commissioner Alan Kirkland explained.
“Scams are becoming more sophisticated and harder to spot, including the use of AI-generated deep-fake videos of well-known personalities.”
Further, Kirkland recognised victims often do not realise they have been scammed because they own shares listed on the Australian Securities Exchange.
“The loss occurs when the scammers sell out and the share price collapses. Investors are left holding shares worth a fraction of what they paid,” he said.
“Just because you can see shares in your trading account, doesn’t mean the investment recommendation was legitimate.”