Older Australians are losing their life savings to a global investment scam.
A speculative investment scheme new to Australia has already robbed investors of millions of dollars, with many older Australians losing their life savings to the risky racket.
The Federal Government is now being urged to ban the scheme known as ‘binary options trading’ after claims it has been hijacked by scammers who are stealing the savings of Australians from right under their noses.
In the short time this investment scheme has been targeting Australia, investors have lost more than $7 million.
Binary options trading, which is legal in Australia, allows investors to speculate on whether a stock or commodity price will rise or fall in the short term. It’s a similar process to betting, with investors who see early success then being conned with the promise of huge returns to go ‘all in’, losing everything in the process.
International fraudsters cold call investors and use gambling industry tactics to pressure them into sending them money that they then falsely claim to invest on their behalf.
Many of those scammed by fraudsters claim the money they sent was never invested or that dividends were not returned.
Countries around the world, such as Israel and Belgium have already banned such schemes, with Canada, the UK and Europe all pursuing similar measures.
The Australian Securities and Investments Commission (ASIC) has forced Facebook and Google to stop advertising any unregistered traders who could be promoting such schemes.
A 62-year-old man lost $600,000 to the scam, and there are further reports of Australians losing up to $1 million to the sneaky stratagem.
Another victim of the scam, Peter Green from Adelaide, said his money was never invested, simply stolen.
"He robbed me of all my savings I was trying to put aside to build a house, so it's been pretty hard," said Mr Green.
The Australian Competition and Consumer Commission Deputy Chief, Delia Rickard, says the $7.5 million already lost is just “tip of the iceberg”.
"If you've lost a significant amount of money, the sad news is you're very unlikely to get it back," she said.
Should binary options trading be banned or should investors monitor their own financial activity? Have you, or do you know anyone, who has received such calls?