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With the rise of online business activity and cryptocurrency, people are looking more and more to different types of digital investments. The rise of the internet has led to increased anonymity in the online space. Therefore, it can be difficult to verify the legitimacy of some businesses and web users. In the new technology era, it is important to be aware that some of these investment schemes are fraudulent, and if something goes wrong, it can be difficult to retrieve your money. This article will explain what online scams are, what you can do to get your money back and what steps you can take to minimise the risk of being scammed.

What Are Online Scams?

Online scams cover many different scenarios. However, there are a number of common themes, including:

  • phishing emails (a fraudulent email, disguised as a reputable source) to obtain personal information about you, particularly phone numbers, emails and passwords;
  • random contact from an anonymous individual with an investment opportunity or prize collection;
  • theft of cryptocurrency, initial coin offering (ICO) or Bitcoin from an online digital wallet; and
  • catfishing (when a person takes information and images and uses them to create an identity for themselves) and romance fraud.

Note that this is not an exhaustive list. You can learn more about current and active scams on the Australian Securities and Investment Commission (ASIC) website. ASIC manages financial markets and services and publishes regular warnings to educate consumers and protect them from scams.

What Can I Do to Get My Money Back?

If you have been the target of a scam and have lost money, there are several actions you can take. The first step should be to contact your bank or financial institution to report the transaction immediately. They may be able to stop the transaction processing or provide some fraud assistance. However, this will vary between institutions. 

Report It

If you are certain the investment is a scam, you can report it to ASIC. They accept reports of misconduct. Further, if the financial institution or investment receiver has acted illegally, ASIC may take action. However, it is important to bear in mind that ASIC’s powers may be limited if the other party is unidentifiable or based overseas. However, these types of reports can be used to gather information about different online scam trends to protect other individuals in the future. You can also report cybercrime and scams to the Police.

Conduct Research

Additionally, you can conduct your own research to identify the scammer. First, you will need to determine where they are based. To do this, you can look for identifying features like an ABN or ACN on the investment website. You can also look for the overseas equivalents. Given that many of these investments are designed as scams, it may be difficult to find this information. Therefore, it would be best to establish these details before proceeding with the investment.

Legal Action

Finally, you may want to consider legal action. Getting a lawyer involved in these matters can be expensive and time-consuming. However, if your investment is significant and you can identify the other party and what country they are based in, it may be worthwhile. Your lawyer will need to assess whether there has been any illegal conduct and what steps you can take to retrieve the money. The debt recovery process is costly and may involve going to court. This process is made significantly more expensive and complex if the other party is based overseas.

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What Steps Can I Take to Minimise My Risk?

There are a number of steps that you can take to mitigate your risk, set out below:



Blocking unknown email addresses, phone numbers and phishing emails.

If you are being contacted out of the blue with scam emails, this may be because your email or telephone number is subject to a data breach. This means that one of your accounts, whether it be an online shopping service or social media platform, has been hacked. Therefore, you have lost some of your personal information, which is now available on the dark web. The dark web is an area of the World Wide Web that is not accessible via conventional search engines and requires certain software to access it. Consequently, online scammers are contacting you.

Updating your passwords and using a password manager.

Further to the above, to stop the scammers from using your lost information, you can update your passwords on important accounts. You can also use a password manager to store and remember your passwords for the future. This will ensure that your remaining accounts stay safe even though one of your passwords has been compromised and may be widely available on the dark web.

Doing your research before investing in cryptocurrency.

Determine who is offering the investment opportunity and where they are based. Consider what identification details they can provide about their business and check the legitimacy. If they are based outside of Australia, it can be difficult to pursue them legally or to report them to the Australian oversight bodies.

Generally, it is easier to take steps to reduce your risk as opposed to resolving the issue reactively. 

Key Takeaways

When it comes to unsolicited online investment opportunities, caution is the best approach. As with any business decision, it is important you do your due diligence and research before committing to any major investments. Additionally, you should avoid providing personal information to unknown parties unless absolutely necessary. If you have fallen victim to a scam, consider reporting it to the relevant government authorities. If you have been scammed and want legal assistance to retrieve your funds, contact LegalVision’s dispute resolution lawyers on 1300 544 755 or fill out the form on this page.

Frequently Asked Questions 

What are some common online scams?

There are many types of scams. However, some common scams include phishing emails to obtain personal information about you, particularly phone numbers, emails and passwords, random contact from an anonymous individual with an investment opportunity or prize collection, theft of cryptocurrency or Bitcoin from an online digital wallet, catfishing and romance fraud.

How can I minimise the risk of being scammed?

Some ways you can minimise risk include blocking unknown email addresses, phone numbers and phishing emails. You can also update your passwords, use a password manager, and undertake research before investing in cryptocurrency.


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