Fake Investment Company Scam

If it sounds too good to be true, it probably is.

Introduction

The fake investment company scam is a type of scam in which the user is led to believe he can invest in crypto through a professional investment company that offers excellent daily returns on investments. If the user falls for the scam, he will lose all of the invested funds.

A scammer reaches out via Telegram, luring the user to invest money in a fake company.
A scammer reaches out via Telegram, luring the user to invest money in a fake company.

Scam Type

Social Engineering.

Purpose

The purpose of the fake investment company scam is to accumulate crypto from investors interested in making a quick profit online.

Attacker

Attackers are mostly divided into two groups:

  • The webmasters and developers who’s job is to build a website for the fake investement company. The website has a registration form, full functionality for sending crypto, neat design, etc.
  • The messaging app scammers, who scan crypto groups and contact random members, offering them with an opportunity to invest money in fake companies.

Victim

Victims of the fake investment company scams are users interested in making a quick profit from crypto.

How does the fake investment company scam work?

For the attacker to succeed, the user has to take the following actions:

  • The user has to join a Telegram or Discord group associated with crypto. Attackers are continuously scanning crypto groups and targeting random members.
  • The victim gets a direct message from a person who is not in the user’s contact list. The person claims that he is an investor, making excellent returns with an investment company he found online. The person urgest the user to check the website of the company.
  • If the user follows the link, the user is forwarded to the attacker’s landing page (website). The landing page advertizes different investment plans, often claiming unrealistic daily returns. Typically these range between 2.5% to 3.5% daily.
  • If the user registers and sends his crypto to the fake investment company, the user becomes the victim of the scam. All of his funds get stolen.
Website of a fake investment company
Website of a fake investment company. Investment plans offer 2.5% to 3.5% daily.

How to protect yourself?

The first step in protecting yourself from this type of scam is to ask yourself why would a stranger on the Internet randomly contact you with an offer to make money. If the money-making scheme is working so well, why waste time on contacting strangers via Telegram instead of putting your assets inside?

For protection against these types of scams, do the following:

  • Enable maximum security on your Telegram and Discord. Inside the app settings you can disable calls from people who are not on your contact list.
  • Take a moment to think about the reasons why a stranger is directly contacting you. If it looks too good to be true – it probably is.
  • Never send money to services that you cannot verify or research independently via Google.
  • Never send money to services that are offering unrealisticly high returns on investment.
  • Consider using a cold wallet for storing your crypto.
  • Consider investing in legit passive income projects.

Stay safe out there.

Written by Scam Buster

A cryptocurrency investor and a journalist by day, Scam Buster spends most of the daytime refreshing his portfolio and taking coffee breaks. By night, however, he sheds all pretense and takes to the shadowy URLs of the Internet, busting scammers wherever he goes.

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