Investment & Ponzi Schemes in Australia 2025
$945 million lost to investment scams in 2024. ASIC removed 7,227 fake investment platforms. Learn to protect yourself from high-return fraud and Ponzi schemes.
Investment scams extracted $945 million from Australians in 2024, down from $1.3 billion in 2023 but still representing the number one scam type impacting the country. The median loss per victim was $9,500, a devastating amount for most families. Despite improved enforcement and awareness, these sophisticated frauds continue to destroy retirement savings, drain superannuation accounts, and leave victims financially ruined.
ASIC removed 7,227 fake investment platforms in 2024 and is currently shutting down 130 scam websites per week in 2025.
This aggressive enforcement represents a 31% increase in ASIC activity, with 109 new investigations, 15 court actions, and 376 surveillances completed in the last six months. The agency secured $46.6 million in civil penalties and 13 criminal convictions.
Despite this unprecedented crackdown, new fake investment sites appear almost as quickly as old ones are removed, making consumer awareness and skepticism essential defences against these pervasive frauds.
ASIC's Enforcement Crackdown
ASIC's ramped-up enforcement demonstrates the severity of the investment scam crisis. The agency initiated 109 new investigations in the last six months, launched 15 court actions against fraudulent operators, and completed 376 surveillances to monitor suspicious investment activities. This represents a 31% increase in enforcement activity compared to previous periods, reflecting both the scale of the problem and ASIC's commitment to combating it.
Of 10,240 total sites removed, the breakdown reveals the varied tactics scammers employ:
The 7,227 fake investment platforms represent the bulk of fraudulent operations, offering everything from fake bonds and term deposits to fraudulent stock trading platforms. Another 1,564 phishing hyperlinks were designed to harvest credentials for legitimate investment accounts.
The remaining 1,257 sites specifically targeted cryptocurrency investment scams, exploiting confusion around digital assets and blockchain technology. The $46.6 million in civil penalties and 13 criminal convictions represent real consequences for scammers, though many operate from overseas jurisdictions beyond Australian law enforcement reach.
Common Investment Scam Types
Fake High-Return Bonds and Term Deposits
Scammers impersonate real businesses offering fake sustainability investment bonds or term deposits with returns between 4.5% and 9.5% per annum. They claim these investments are government-protected and risk-free, exploiting people's trust in traditional savings products like bonds and term deposits. The returns they promise are slightly higher than current bank rates but not so extreme as to trigger immediate suspicion. This positioning in the "too good to pass up but not too good to be true" zone makes these scams particularly effective.
The falsified documentation is extremely high quality:
Scammers mimic actual prospectuses from major financial services providers with professional layouts, legal terminology, and convincing disclaimers that ironically make the fraud seem more legitimate. Fake regulatory stamps, forged signatures from executives at real companies, and sophisticated branding make these documents nearly indistinguishable from genuine investment materials.
Always verify any investment opportunity with Moneysmart's investor alert list before committing funds. If a company or investment product appears on that list, it's a confirmed scam regardless of how legitimate the documentation appears.
Ponzi Schemes
Ponzi schemes promise high returns by using new investors' money to pay earlier investors, creating the illusion of a profitable business.
They collapse when new investment slows or stops, leaving the majority of participants with total losses. No actual profitable business exists. It's purely a redistribution scheme where money flows from new victims to earlier victims and the operators. The name comes from Charles Ponzi, who famously ran this type of fraud in the 1920s, though the scheme predates him.
Warning signs include:
Guaranteed high returns regardless of market conditions, consistent returns that never fluctuate with market volatility, secretive or overly complex investment strategies that operators refuse to explain clearly, and difficulty withdrawing funds when you want to cash out.
Operators often claim proprietary trading algorithms or exclusive access to investment opportunities that explain their superior returns. In reality, there's no actual investment activity happening. Your money is simply being used to pay earlier investors, and when the scheme inevitably collapses, you'll discover there's nothing left.
Learn more about the mechanics and warning signs of Ponzi schemes from ASIC's Moneysmart resource.
Pump-and-Dump Schemes
Scammers artificially inflate the price of low-value shares or cryptocurrencies through false promotions, coordinated buying, and misleading claims about the asset's potential. Once the price rises due to the hype they've created, they sell their holdings at a profit, leaving other investors with worthless or dramatically devalued assets. The "pump" is the artificial price increase through promotion and coordinated buying. The "dump" is when the scammers sell at the inflated price, causing the value to crash.
These scams often spread through social media, online forums, and messaging apps:
Scammers create fake hype with fabricated news about partnerships, technological breakthroughs, or regulatory approvals. They might use multiple accounts to simulate organic excitement and urgency. Messages often include phrases like "This is not financial advice" to provide legal cover while clearly trying to manipulate you into buying.
By the time everyday investors hear about the opportunity and invest, the scammers are already preparing to dump their holdings and crash the price.
Red Flags for Investment Scams
Guaranteed high returns with low or no risk
All legitimate investments carry risk, and higher returns always correlate with higher risk. If someone guarantees you'll make 8%, 10%, or 15% annually with no possibility of loss, they're either lying or running a Ponzi scheme. Real investment advisors discuss risk management, diversification, and the possibility of losses. Scammers only talk about guaranteed gains.
Pressure to invest quickly
Legitimate investments don't have arbitrary deadlines. Stock markets, real estate, and genuine investment products will still exist tomorrow, next week, and next month. Scammers create false urgency because they don't want you taking time to research, consult advisors, or think critically about whether the opportunity makes sense. They want your money before you realise it's a scam.
Unsolicited contact
Real investment opportunities come through regulated financial advisors you've chosen to work with, not cold calls or social media ads. If you didn't seek out this person or company, why are they contacting you? The answer is usually because they're running a scam and need to find new victims. Legitimate investment firms don't need to cold-call people or send unsolicited messages.
Complex strategies that are poorly explained
Real investment approaches can be explained clearly to laypeople. If an advisor can't or won't explain how they're generating returns in terms you can understand, they're either incompetent or fraudulent. Legitimate proprietary strategies still have explainable foundations. Scammers hide behind complexity and secrecy because there's no real investment activity happening.
No Australian Financial Services Licence (AFSL)
Any company or individual offering investment services in Australia must hold an AFSL. You can verify this through ASIC's register at asic.gov.au. If they can't provide an AFSL number, or if the number they provide doesn't match their name in ASIC's database, they're operating illegally. No exceptions. Operating without proper licensing is a massive red flag that should end your consideration immediately.
Difficulty withdrawing money
Often the first sign victims recognise that they've been scammed. In Ponzi schemes, operators might delay withdrawals with excuses about processing times, require you to invest more before withdrawing, or simply stop responding to withdrawal requests. Legitimate investments have clear, timely processes for accessing your money.
Celebrity endorsements
Scammers use AI-generated deepfake videos of Elon Musk, Andrew Forrest, or other wealthy figures appearing to endorse their platforms. These deepfakes have become remarkably convincing, with authentic-looking video and perfectly cloned voices. Real celebrities don't endorse specific investment platforms in unsolicited social media ads. If you see what appears to be a celebrity promotion, assume it's fake.
Payment via cryptocurrency, gift cards, or wire transfer
These payment methods are difficult or impossible to reverse and hard to trace. Legitimate investments are made through regulated financial channels with proper documentation and investor protections. If someone asks you to buy Bitcoin or gift cards to invest, you're being scammed. These payment methods make it nearly impossible for you to recover your money.
Recently registered website domains
Scammers create sophisticated sites that look like established financial institutions, but checking domain registration through WHOIS lookup often shows they were created days or weeks ago. Real investment companies have domains registered years or decades ago. If a company claims to have decades of experience but their website was registered last month, they're lying.
How to Verify Investments
Check ASIC's Moneysmart investor alert list
Before committing any money, check moneysmart.gov.au . This list contains confirmed scam companies, websites, and individuals. If the opportunity you're considering appears on this list, it's a confirmed fraud regardless of how legitimate it seems. The list is updated regularly, so check it every time before investing.
Verify Australian Financial Services Licence (AFSL)
This search is free and takes minutes via ASIC's register. Enter their name or ABN and confirm they're authorized to provide the specific financial services they're offering. Check that the license is current and hasn't been suspended or cancelled. If they claim to have a license but you can't verify it through ASIC's official register, assume they're lying.
Search for scam warnings online
Search the company name plus the word "scam" in Google to find warnings from previous victims or watchdog organizations. Often victims share their experiences on forums, review sites, or complaint boards before official authorities catch up with the scam. If multiple people are calling it a scam online, that's valuable information even if it's not yet on official warning lists.
Get independent financial advice
Especially for large amounts or complex products. Pay for advice from a licensed financial advisor who doesn't benefit from your specific investment decision. This independence ensures they're evaluating the opportunity objectively rather than trying to earn commissions. The cost of professional advice is trivial compared to the potential loss from a scam.
Never invest based solely on social media ads or cold calls
These sources have no accountability and are favorite distribution channels for scammers. Social media platforms struggle to identify and remove fraudulent investment ads before they reach millions of people. Real investment opportunities come through regulated channels with proper documentation and disclosure.
Research the company's ABN and business history
Through ABN Lookup and ASIC's company register. Verify the company is legitimately registered, check how long it's been in business, and review any publicly available information about its directors. Scammers sometimes register legitimate business structures to appear more credible, but the history will often show they're brand new despite claims of operating for years.
Be skeptical of returns above 5-7% annually for low-risk investments
While higher returns are possible with higher-risk investments, anyone promising 10%, 15%, or 20% annual returns with low risk is lying. Current market conditions and historical data make such returns mathematically impossible without substantial risk. If the promised returns are significantly higher than what major banks offer, it's fraud.
Read all documentation thoroughly
Don't let anyone pressure you to sign without reading. Look for disclosure of risks, fee structures, and terms for withdrawing funds. Legitimate investment documents include substantial risk warnings and clear information about fees. If documentation is sparse, vague, or focuses only on potential gains without discussing risks and fees, that's a red flag.
Verify contact details independently
Look up the company's official website and phone number yourself rather than using details provided in the promotional material. Scammers often provide fake contact information that goes back to them. If you search independently and find different contact details than what was provided, that discrepancy indicates fraud. Call the official number you found independently and ask about the specific investment opportunity you were pitched.
With $945 million lost in 2024 and ASIC shutting down 130 scam websites per week, investment fraud represents the most financially devastating scam category in Australia.
The sophistication of fake documentation, deepfake celebrity endorsements, and replica financial service websites makes these scams increasingly difficult to identify. Your best protection is skepticism of unsolicited opportunities, thorough verification through official channels, and consulting independent financial advisors before committing funds.
If an investment promises guaranteed high returns with low risk, if you're being pressured to invest quickly, or if the opportunity came through a cold call or social media ad, walk away. Legitimate investment opportunities can withstand scrutiny, research, and time for consideration. Scams cannot.