Investment Fraud Investigations
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UK Private Investigators
Are you worried about investment fraud? If so, you’re not alone. Investment fraud is a growing problem in the world today, with perpetrators targeting vulnerable people in order to steal their money. What’s even more frightening is that perpetrators often go undetected – until it’s too late. This blog outlines the different types of investment fraud, how they’re investigated, and the consequences of investment fraud for victims. By reading this blog, you’ll be better equipped to identify investment fraudsters and protect yourself from harm.
What is investment fraud?
Investment fraud is a broad term, but usually when it’s used, it’s referring to being convinced to transfer large sums of money into a fake company or service, usually by someone posing as an investment service provider, financial advisor, or a fund manager. Similarly, investment fraud can also look like being promised high returns with little to no risk. In any case, investment fraud involves you being deceived into handing over your hard-earned cash.
Conducting an investment fraud investigation
Investment fraud investigations can be carried out before you invest, or after the fraud has taken place. Ideally they’ll happen before!
Prior to investing, investment fraud investigators will be able to conduct a series of checks that verify the identity of the person you’re in contact with, the existence of the company or service you’re looking to invest in, and evidence to suggest whether or not investing your money would be a truly wise move.
Following suspected investment fraud, we would examine any evidence to suggest investment fraud has taken place, complete thorough background checks on all the individuals involved, and work to help recover your money, as the steps below outline.
What are the consequences of investment fraud?
It can be difficult to know when something is wrong, and you may be a victim of investment fraud. That’s why it’s important to be cautious and do your research before investing your money. There are many consequences of investment fraud, including financial losses, damaged reputation, and emotional distress. If you think you may have been the victim of fraud, the best thing to do is to contact the authorities. They can help you investigate the situation and protect future victims.
If you’re still feeling concerned or confused, don’t hesitate to reach out to your personal financial advisor for help. They are equipped to deal with these delicate situations and will be able to provide you with the support you need to get through this tough time.
The different types of investment fraud
Investment fraud will usually follow a similar pattern. Being able to recognise these as red flags is crucial in preventing fraud before it occurs, and investigate those attempting it. The common types of investment fraud include:
Microcap and penny stock fraud
This involves targeting stocks with very low market capitalisations – in the US, microcap is anything under $300 million, with ‘penny stocks priced’ below $5 per share. These stocks are typically traded on platforms that are less regulated using false information to inflate prices before they’re sold. It leaves investors with worthless shares, not to mention a bad taste in their mouths.
Prime bank fraud
In these instances, fraudsters claim they have access to ‘prime’ or top-tier banks, promising unrealistic returns to investors. In reality, these “prime bank” investments don’t exist, and the fraudsters run off with your money.
Renewable energy fraud
This type of investment fraud tugs on the heartstrings of the eco-conscious, giving them an ‘opportunity’ to invest in green initiatives, such as solar or wind farms. Surprise surprise, these initiatives often do not exist.
Affinity fraud
This type of fraud relies on the trust that exists between tight-knit groups, such as religious communities, social organisations, or ethnic groups. By gaining members’ trust, they convince them to invest in fraudulent schemes, and unfortunately this often leads to significant losses for the community, and irreparable breaks in trust.
Pump and dump
The ‘pump’ in this catchily named fraud type is where fraudsters inflate the price of a low-cost stock. They do this by spreading false or misleading information, creating something of a buying frenzy amongst those looking to get a good deal. They then sell their shares for a profit – effectively ‘dumping’ the other investors with little return on their money.
Ponzi schemes
These schemes promise high returns with little risk by paying earlier investors with the money input by newer investors, rather than with legitimate profits.
Precious metals fraud
This fraud uses those shiny things to lure in victims; gold, silver, or platinum are often offered at inflated prices. The metals then don’t turn up, or turn out to be massively overvalued, leaving the victim out of pocket when they try to sell.
Foreign currency exchange fraud
Scammers promise high profits with little risk from currency trading in foreign currency exchange fraud, but they often misrepresent risks, overcharge on fees, or engage in unauthorised trading.
Stages of Investigation
Fraud Examination
We start by determining whether there’s evidence of investment fraud at this early stage. We also determine how the scam was carried out, as well as the expenses incurred. Finally, the guilty parties are discovered.
Comprehensive Due Diligence
We complete a full background check of the responsible parties and their companies during this stage of the investigation. This includes searching for criminal history, credentials and any other pertinent information.
Financial Recovery
We locate the firm’s assets and accounts to enable them to be redistributed in the post-judgment period so the client can be compensated.
Investment fraud red flags
Some red flags that may indicate that someone is committing investment fraud include:
- If the person offering the investment has little experience or knowledge about financial markets and investments. This may be because they’re not actually invested in the project, or they’re just trying to take advantage of you.
- Anyone who is pressuring you to commit right away – this could also be an indicator of fraud.
- Promises being made by the scammers. Some will claim that their investment will double, triple or even quintuple in value within a short period of time. However, this is almost always impossible to happen and can lead to serious financial losses.
Is investment fraud a civil or criminal matter?
Civil fraud is investigated by the victim (which is where UKPI can help), and criminal fraud is investigated by the police. In the former case, the desired outcome is to recover the money lost, and in the latter it is to see the perpetrator brought to justice. Therefore investment fraud is a civil matter, and it can also be a criminal matter if the law has been broken.
Ways to protect yourself from investment fraud
Due diligence
Before investing any of your precious capital, we’d strongly recommend that you first do your due diligence. This means checking as much as you can that the person you’re dealing with is genuine, and the product, service, company, or initiative that you’re investing in exists and is worth as much as you’re being told it is.
We’d recommend getting professional help with this; an investment fraud investigator will likely know how to legitimately find helpful information that you may not.
FCA register
Really, you should only deal with firms that are backed by the Financial Conduct Authority (FCA). They can provide reassurance that the company you’re looking to invest with is authorised by them, and has permission to be offering what they’re offering. You can check the FCA register to be on the safe side; anyone not registered should ring alarm bells.
Detailed background checks
Part of your due diligence should be a comprehensive background check on the individual and/or the company that you’re looking to hand your money over to. These will help verify identities, verify business legitimacy, and give you insights on their financial health, key personnel, reputation, and other important information.
Investment fraud recovery and restitution
If you’re unfortunate enough to be a victim of investment fraud, your hope is to recover financially from what has happened. By bringing together evidence that can stand up in court, you give yourself the best chance of recouping what you’ve lost from the fraudster that took it from you – this is known in the financial world as restitution.
Why hire UKPI for investment fraud investigation services?
Investment fraud can not only be devastating financially, but it can also have a huge impact on your mental health. At UKPI, it’s our commitment to you to support you through this process and do all we can to gather evidence for your case, always with the aim of bringing the fraudster to justice.
If you’re looking for reassurance before an investment, it’s our pleasure to give you the confidence to either go forward and happily invest in a genuine opportunity, or turn away from what you now know to be a scam.
In any case, our investment fraud investigation techniques can support you solidly, combining both online and physical surveillance with online research techniques, and access to the sources from which we know we can legally obtain information. All this we’ve learned in over 25 years in business.
FREQUENTLY ASKED QUESTIONS
Things that should present as red flags to you include high ‘guaranteed’ high, complex or secretive strategies, a pressure to invest quickly, a general lack of transparency, and unclear or overly optimistic financial claims.
First, contact us for an initial consultation. We can investigate to determine if fraud is definitely the case, and work with you and the police to gather evidence and consider potential recovery options if so.
Yes, UKPI can examine financial statements, revenue claims, and debt information to verify whether assets and profits are as claimed. This will give you an idea of whether any details are exaggerated or fabricated.
Yes, we provide detailed, legally-compliant reports and can testify in court if needed. All evidence gathered is documented in a way that meets legal standards.
The timeframe in which we complete our investigation will be dependent on the complexity of your case. However, most investigations can be completed within a few weeks. We can provide an estimated timeline after your initial consultation.
While recovery isn’t guaranteed, we’ll certainly do the best we can; our findings can support legal actions or negotiations, and we can work alongside legal teams or authorities in efforts to recover your money, or seek compensation.
What we charge will depend on the complexity and the scope of the case. We offer a tailored quote after our initial consultation.
Yes, all investigations are conducted with strict confidentiality. We prioritise client privacy, and handle sensitive information with discretion.
Yes, UKPI can handle international cases; we work with a trusted network to conduct thorough investigations on foreign investment opportunities, ensuring compliance with local laws and regulations.
Contact UKPI today to begin your fraud investigation
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