While the old saying "money doesn't grow on trees" has never felt more applicable, investing wisely can protect your savings from inflation—and maybe even gain you a small profit. Today, investment opportunities are often just one click away. What is the downside to such easy access to something that can positively influence your financial well-being? Scams!
As online investing opportunities continue to become more widely available, so do the schemes designed to steal your resources, money, or personal data. In 2025, learning how to protect yourself against cybercrime will be an essential skill and another more important type of investment—an investment to save yourself from financial and emotional loss.
Investment Scams to Watch Out For
Not all investment opportunities are what they seem. Some are outright tricks specially engineered to separate you from your money. Some scams are easy to notice, while others use more obscure tactics. Knowing what to look for can help identify a possible scam.
- Crypto scams often involve fake crypto exchanges, pump-and-dump schemes, or fraudulent token sales.
- Fake investment platforms are websites that mimic real financial institutions and pressure investors into quick deposits.
- Ponzi and pyramid schemes may promise steady, risk-free returns that rely on funds from new investors. It's until the scheme collapses.
Spotting Crypto Scams
Cryptocurrency scams are constantly reinventing themselves. Also, there are a few predictable warning signs to watch out for.
An idealistic promise or guarantee of high return with the reassurance of little risk is always a red flag. Since crypto has such high volatility, with a history of significant price surges, it may be easier to believe the assurance of a big return. But remember: the return on a token can just as easily drop significantly with no warning. There is no guarantee.
If the team behind a crypto project lacks transparency or operates anonymously, proceed with caution. Legitimate investment opportunities are registered with financial authorities, including crypto currency trading platforms. It's a good idea to double-check before investing.
Red Flags for Fake Investment Platforms
A fraudulent investment platform looks outdated and janky, right? Wrong. Fake investment platforms can look sleek, professional, and enticing but are actually a complete scam.
How can you tell? A lack of official registration with a legitimate financial regulator—Canadian or otherwise—is the first solid indicator something is off. Another possible red flag is poor customer service that only offers vague, delayed, or non-existent responses.
If a platform makes it difficult to withdraw your money, reconsider investing immediately. Some types of investments require a fixed period before withdrawing interest or returns. However, you should always be able to easily withdraw the money from the platform once the funds are available.
Signs of a Ponzi Scheme
Ponzi schemes rely on constant recruitment. If an agency makes money mainly by bringing in new investors rather than on actual returns, it’s probably a scam. The promise of steady and unrealistically high returns is the earmark of a potentially shady investment opportunity, including a possible Ponzi scheme.
Legitimate investment enterprises have a clear, verifiable business model. Yet, Ponzi schemes have historically ensnared millions of investors. They even come from seemingly reputable agencies or individuals. Look no further than Bernie Madoff's infamous case or the more local alleged fraudster Greg Martel.
Asking for a transparent business model from a potential investment enterprise can help avoid getting involved in a Ponzi scheme. If a business has nothing to hide, it will have no issue providing a solid plan and additional context for how your investment will be utilized.
Targeting Online Investors
Online scams can be quite eloquent, which is part of what makes them so dangerous. Scammers have various tactics to lure people into their fake investments.
- Social media manipulation happens when scammers introduce many fake success stories, testimonials, and influencers who (sometimes unknowingly) promote fake projects. This type of content creates the illusion of social trust. It might also generate FOMO (fear of missing out), which can cause people to act without thinking deeply about the legitimacy of a claim.
- Phishing attacks are sending emails, texts, or DMs to people pretending to be financial advisors, banks, or investment firms. The communications may come from reputable sources, including real and established companies. When a user clicks on the link or introduces login or bank details in a form field, their information could be stolen or malware may be injected onto their devices.
- Fake apps are apps that appear to be legitimate trading or investing platforms. Once downloaded, these apps can steal sensitive data or lock users out of their accounts.
- Deepfake scams—yes, we’ve reached that point—are scams which use AI-generated deepfake videos or voice recordings to impersonate a real, trusted person. The deepfake may attempt to make fake investment pitches that sound convincing. Always be cautious when hearing unsolicited investment advice, even if it seems authentic.
Protecting Your Money Online
Staying safe online requires awareness and proactive action. Before depositing any money, take a few extra minutes to verify the legitimacy of an investment platform. A quick Google search can provide useful results. It might help you distinguish between a scam and a legitimate investment opportunity.
Secure your connection, especially if you’re using a public wifi network—sign up for a VPN service that can be used to encrypt your online activity. A VPN can help protect you from identity theft, safeguard crypto or other investment transactions. It also allows you to share financial documents safely.
Learn the psychology of investing. Don’t let emotions like excitement, urgency, or greed dictate your financial decisions. Recognize the warning signs of a scam before you start investing. If something feels off, trust your gut first—and then take a moment to investigate further.
Investing Safely
In this economy, investing your money is as important as ever. But don’t get caught in the race of easily available opportunities, too-good-to-be true offers, or the pressure to get more, faster. Scammers rely on urgency, misinformation, and psychology to get people to give them their money. And, truthfully, it could happen to anyone.
Using reliable tools, trusting your instincts, and taking the time to verify before introducing money to any investment are essential ingredients to investing safely. Don’t let your emotions dictate your decision making, but remember, the process doesn’t have to be (and shouldn’t be) stressful.
