ScamSmart

Investment and pension scams are often sophisticated and difficult to spot. According to the FCA, thousands of people fall victim to investment fraud each year. Scams cost UK investors £197 million with an average loss over £29,000*.

*figures provided by Action Fraud

Raymond James is supporting the ScamSmart campaign from the Financial Conduct Authority (FCA), which aims to help investors stay safe online and avoid becoming the victims of scams.

The methods of investment scams are changing, they no longer exist as simply a cold call, instead more people are being targeted online than ever before.
For example, the number of ‘clone firm’ investment scams, where fraudsters mirror details of authorised firms, reported increased by 29% as the UK went into first lockdown*.

Most at risk are those aged 55 or over and already own investments.

However, on social media, Under 25s are six times more likely to trust an offer made to them than their elder counterparts.

Investments in shares and bonds, forex and cryptocurrencies by firms that are not authorised by the FCA were the most commonly reported scams.

During the first quarter of the year (peak investment season) the FCA warns people to be especially vigilant.

*figures provided by Action Fraud

Warning Signs

Though the contact methods used by fraudsters may vary, their tactics remain the same. Be vigilant when making investment decisions and look out for these six warning signs. Watch the video below to find out more.

Unexpected contact

Traditionally scammers cold-call but contact can also come from online sources e.g. email or social media, post, word of mouth or even in person at a seminar or exhibition.

Time pressure

They might offer you a bonus or discount if you invest before a set date or say the opportunity is only available for a short period.

Social proof

They may share fake reviews and claim other clients have invested or want in on the deal.

Unrealistic returns

Fraudsters often promise tempting returns that sound too good to be true, such as much better interest rates than elsewhere.

False authority

Using convincing literature and websites, claiming to be regulated, speaking with authority on investment products.

Flattery

Building a friendship with you to lull you into a false sense of security.

Fraudsters are becoming increasingly adept at what they do. Their methods can be extremely sophisticated and we must be more vigilant in response. They may seem financially knowledgeable and articulate, often with supporting documentation that make them hard to distinguish from those that they’re impersonating.

Be a ScamSmart Investor

Reject unexpected offers

Scammers usually cold call, but contact can also come by email, post, word of mouth or at a seminar. If you’ve been offered an investment out of the blue, chances are it’s a high-risk investment or a scam.

Check the FCA Warning List

Use the FCA Warning List to check the risks of a potential investment – you can also search to see if the firm is known to be operating without our authorisation. To check visit www.fca.org.uk/scamsmart

Get impartial advice

Get impartial advice before investing. don’t use an adviser from the firm that contacted you.

Click here to visit the FCA website for more information about this campaign, and to access the wealth of resources and information on how to spot and report a scam.

Download the ScamSmart factsheet

You may also be interested in

Who was Raymond James?

The Raymond in our name is actually from Edward Raymond, owner of a 15-employee mutual fund sales group, Raymond and Associates, along Florida’s west coast. He sold his company to Bob James on 15 July 1964, on condition that the surviving firm be called Raymond, James & Associates.

Three days after the sale, Ed Raymond was involved in a near-fatal automobile accident and never joined the firm.

Nonetheless, even after Raymond had passed away, Bob James insisted that his name remain on the door – ahead of James’ own. That was a promise he made to Ed Raymond three days before the accident, and Bob James was a man who kept his promises.

Bear Market of 1974

The severe bear market of 1974 threatened the existence of Raymond James, which was bleeding capital by the day. Tom James, his father and other leaders took extreme measures to keep the firm afloat, slashing costs, foregoing paychecks and even attempting to sell the firm for just enough capital to protect client assets and retain as many associates as possible. The story could have ended very differently if not for a sharp upturn and continued rebound in the stock markets late in the year.
This “fortunate near-death experience” (as Tom calls it) permanently marked his psyche, and has influenced our firm’s character and culture since, solidifying the conservative nature that emphasizes a determined focus on the long term – both for clients and the firm.

Taking Raymond James Public

When consideration was being given to taking Raymond James public, Tom James penned a letter to shareholders (largely employees at the time).
He wrote:

” … the public offering should be considered as a statement of our independence. While this is a psychological rather than an economic rationale, it is nonetheless very important. We have asserted for some time that we are not interested in becoming a small part of a very large corporation. That assertion results mainly from the inclinations of management rather than the economic benefits associated with either alternative. The public stock offering affords us the opportunity to enjoy a little bit of the best of both worlds. While shareholders will be given liquidity at fair market value, we will still have the ability to control our own destiny.”

After 40+ years of Tom’s leadership, upon becoming CEO, Paul Reilly was often questioned about whether the company might ultimately surrender its cherished independence and be acquired by some larger entity. His response: “Not while I’m around.” It’s a theme that continues today.

Black Monday

On 19 October 1987, the stock markets experienced a dramatic plunge that prompted many firms to shut down their trading desks and turn off their phones to minimize internal losses. Raymond James refused to do the same. Our desks stayed open to help meet clients’ needs, resulting in our first and only unprofitable quarter since the firm went public in 1983.