Investment scams are one of the fastest-growing forms of financial fraud worldwide. They often look legitimate on the surface, promise high returns with little or no risk, and target people looking to grow their savings quickly. In reality, they are designed to steal money and disappear without a trace.
Online safety group Netsafe is warning New Zealanders to be especially cautious when evaluating investment opportunities, following new data that shows a rise in financial losses and the average amount lost to investment scams.
In March, Netsafe recorded $39,100 in reported losses from investment scams. By April, that figure had more than doubled to $81,500. Over the same period, the average loss also jumped significantly, rising from $7,800 to over $20,000.
Although month-to-month figures may vary because of small sample sizes, the longer-term trend clearly shows the substantial harm these scams are causing.
In the past 12 months, investment scams reported to Netsafe have led to total losses of $1.23 million, with victims losing an average of $14,800 each. Recent figures indicate that average losses are once again on the rise.
“These scams are highly convincing and often involve weeks or even months of grooming before any money is requested. Scammers can sound like legitimate investment brokers, and their websites often look identical to genuine platforms,” Netsafe Digital Harms Services Manager Alex Yi said.
“One method gaining traction is the use of well-known public figures or ‘celebrity’ endorsements to create a false sense of trust.”
“Investment scams don’t just affect vulnerable people — experienced investors are often prime targets. These scams are designed to appear credible and can catch people off guard.”
Warning signs to watch out for
Netsafe is urging people to take basic precautions before investing, such as independently checking any opportunity through trusted sources like the Financial Markets Authority (FMA) and Netsafe’s own verification tools.
Common warning signs of investment scams include promotions or endorsements from celebrities or public figures, promises of high returns with little or no risk, and unsolicited contact about investment opportunities.
Other red flags are pressure to act quickly or keep the opportunity confidential, requests to continue conversations on private messaging apps, and the use of AI-generated content such as deepfake videos or fake profiles.