Number of cases has doubled since 2017. Digitization and the low interest rate environment favor the trend.
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The advancing digitization and the low interest rate environment that has existed for years favor fraud in the area of financial investments. According to a broadcast by the Financial Market Authority (FMA), the number of victims of fraud in Austria has doubled since 2017. This year, almost 600 (594) victims have reported to the authorities. On average, the damage amounts to 42,000 euros per person.
Unrealistic promises
“Unfortunately, we have been observing an increase in investment fraud for years. Financial fraudsters lure their victims into the trap with unrealistic promises, mostly with high returns and low risk,” said the two board members of the FMA, Helmut Ettl and Eduard Müller on Tuesday.
Insider tips and cold calling
Most of the frauds happened on the Internet, around 60 percent of the victims lost their money online through “insider tips and financial products that promise high profit with low risk,” writes the FMA. This is followed by telephone fraudsters who try to sell alleged investments via “cold calling”. Of these, 40 percent were contacted this year.
In order not to fall victim to financial fraudsters, the FMA advises potential investors to check whether a provider is approved or whether there is already a warning against it. In addition, every time you make an investment decision, you should check whether all the important information about a product is available and whether you understand it. The FMA has also put together a list on its website showing how to recognize financial fraudsters and gives examples of their fraudulent schemes.
