The average victim lost £26,773 to these scams over the four-year period, according to the PMI
Britons have lost over £2.6 billion to investment fraud since the start of 2020, according to new research, as experts warn of the rise of scams originating on social media.
Between January 2020 and December 2023, investment scammers stole an average of nearly £13 million per week from 98,525 victims, per a Freedom of Information request to the City of London Police’s National Fraud Intelligence Bureau by the Pensions Management Institute (PMI).
The average victim lost £26,773 to these scams over the four-year period, according to the PMI.
In 2023, 26,740 people fell victim to investment fraud – the most victims in one year during the period. Last year saw a total of £527 million lost to investment scams, worth an average of more than £1.4 million per day.
Investment fraud losses rose during the Covid-19 pandemic as people relied more on online services. The PMI said the cost to victims totalled £756 million in 2021 and £855 million in 2022.
Experts have warned the ongoing cost-of-living crisis is putting more people at risk of bogus ‘get-rich-quick’ schemes as millions look for a fix to their financial woes.
Meanwhile, banks and policymakers have called on Big Tech companies to take more responsibility for the increasing rate of fraud originating online.
Lloyds Bank issued an “urgent warning” to customers last November amid a surge in crypto currency fraud, estimating that around two thirds (66%) of investment scams originated on social media.
The PMI highlighted boiler room fraud as one of the most common types of investment scams. In this type of scam, victims are cold-called by bogus stockbrokers and pressured into buying shares or bonds in worthless or non-existent firms.
The technique cost 20,789 victims a total of more than £553 million over the four-year period, including £106 million last year.
Ponzi and pyramid schemes are another common form of scam, hitting 12,323 Brits since the start of 2020 and costing £499 million. Meanwhile, pension liberation scams cost victims £19 million over the four-year period.