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On Tuesday 12 January we updated our consumer warning against an unauthorised online trader using Instagram, known as chloefxtrades / chloehenx, to include a further account xchloesworld.
This account has been promoted widely on social media and we want consumers to be aware that it is not authorised by us. We have requested that the account should be removed.
Consumers should be wary of adverts online and on social media promising high returns from investing online. Consumers should always do further research on the product they are considering and the firm they are considering investing with.
What consumers can do
Consumers should check the Financial Services register to see if a firm is authorised. If they use an unauthorised firm, they won’t have access to the Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS), so are unlikely to get their money back if things go wrong.
Consumers can also check the list of unauthorised firms and individuals we’ve received complaints about. If the firm isn’t on our list, don’t assume it’s legitimate – it may not have been reported to us yet.
Read more about forex scams.
Online trading scams
UK consumers are being increasingly targeted by investment scams carried out via online trading platforms where fraudsters offer trades in foreign exchange, contracts for difference and cryptoassets such as bitcoin. These are often promoted via social media.
Fraudsters typically promise high returns and use fake images of luxury items to entice people to invest in their scams. The ads then link to professional-looking websites where consumers are persuaded to invest, either through a managed account where the firm makes trades on their behalf, or by trading themselves using the firm’s platform. They may also ask for consumers to message them privately to hear about the investment opportunity and invest that way.
Most consumers report initially receiving some returns from the firm to give the impression that their trading has been a success. They will then be encouraged to invest more money or introduce a friend or family member to invest. However, eventually the returns stop, the customer’s account is suspended and there’s no further contact with the firm.
Many scam firms claim to be based in the UK and even claim to be FCA authorised. Consumers should always check the FCA register to see if a firm is authorised.
The FCA cannot compel social media companies or search engines to remove scam content. However, we encourage consumers to report content to us and to social media companies or search engines directly. This allows us to issue warnings and to request that content is removed.