Dubious trading platforms – how to protect yourself from fraud

3 min 41

Promises of very high and very quick profits while investing? Be suspicious. Again and again, investors are fooled. In this blog article, you will learn which scams are used by fraudsters and how you can recognize reputable trading platforms.

Beware of dubious providers 

Dubious portals promise investors high profits in the shortest possible time. Therefore, the German Federal Criminal Police Office (BKA), the German Federal Financial Supervisory Authority (BaFin), and the European Securities and Markets Authority (ESMA) warn against dubious providers of capital investments.

The BKA reports almost 5,000 cases of fraud and breaches of trust in 2020 in connection with capital investments. This means that investors were defrauded of an astonishing sum of EUR 429 million in 2020 alone. 

This is how the scammers operate: Alleged high profits 

Dubious trading platforms are often professionally designed and typically lure their victims in with quick and high profits. Typically, customers are contacted by telephone by supposed financial advisors after an initial expression of interest. They initially agree on smaller investment amounts of around EUR 300. However, the money is never invested and disappears directly into the criminal network. The victims are then tricked into making further payments with faked profits.   

Alleged fees during payout

When customers request a payout, the problems begin. Although the invested money has long since disappeared, they continue to be led to believe that they have made high profits. Only a fee is required for the payout. The fraudsters’ reason for this payout by claiming to accrue insurance premiums, taxes, or handling fees. This money is also immediately lost. 

Help from the bottom of the barrel

Investors are often tricked a third time – when they seek help on the Internet to reclaim their lost money. Fraudsters use fake forms from the BaFin and demand around 10% of the invested amount as a fee to recover the lost money. This money is also gone.

Three scams you should recognize

Scammers use the same scams over and over again. So knowing them will help protect yourself from scams. Here you can find out which are the three most frequently used scams.

1. The celebrity scam

Fraudulent trading platforms use fake testimonials and advertising messages from celebrities such as Günther Jauch, Herbert Grönemeyer, or Yvonne Catterfeld. This is supposed to create trust – and too often, it works. 

2. Dubious emails and invitations via the calendar

Scammers send links to their fraudulent websites through dubious emails and, more recently, calendar invitations.

3. Calls from abroad

Often investors are called by call centers from abroad and convinced to “invest” more extensive amounts of money.  

Separating the wheat from the chaff – how to protect yourself from scams

Fortunately, there are some concrete things you can pay attention to in order to avoid becoming a victim of criminals. Pay attention to the following aspects, and you will be on the safe side:

  • Address. If it is in popular offshore locations such as the Caribbean or the Pacific, you should be suspicious.
  • Commercial Register. You can check the company and number by an online trade register query.
  • Imprint. If the internet platform has no imprint, this is a bad sign. This should contain the address, company name, contact details, and a commercial register number.
  • Changes. If the company headquarters and/or operating companies keep changing, it is a scammer.
  • Foreign countries. Criminal providers often state foreign regulatory bodies that do not exist. Therefore, you should check them.
  • Browser line. If there is neither a lock symbol nor https at the beginning of the browser line, you should be skeptical.

Here’s what we make of it at UnitPlus

UnitPlus puts a lot of emphasis on good customer service and data protection. That is why we have secured you with the highest security requirements. This includes the function of blocking your card, regulated partner banks, data storage in the EU, encrypted information transfer, a secure payment system, and a biometric login. Of course, UnitPlus is also registered in the Commercial Register.

Kerstin Schneider