Over £27m was reported lost to cryptocurrency and forex investment scams in the last financial year, figures published today show.
Victims lost an average of £14,600 according to the Financial Conduct Authority (FCA) and Action Fraud.
Reports tripled compared to the previous year to over 1,800.
The FCA said fraudsters use social media to promote online trading platforms, often using fake celebrity endorsements and images of luxury items like watches and cars.
Investors will often be led the believe their initial investment has made a profit and will be encouraged to invest more or introduce their friends.
However, eventually the returns stop, the account is closed and the scammer disappears with no further contact.
Director of Action Fraud, Pauline Smith, said: “These figures are startling and provide a stark warning that people need to be wary of fake investments on online trading platforms. It’s vital that people carry out the necessary checks to ensure that an investment they’re considering is legitimate.”
Mark Steward, executive director of enforcement and market oversight, FCA, said: “We’re warning the public to be suspicious of adverts which promise high returns from online trading platforms.”
“Scammers can be very convincing so always do your own research into any firm you are considering investing with, to make sure that they are the real deal.”
Sarah Coles, personal finance analyst, Hargreaves Lansdown said: “The only people to ‘get rich quick’ from these kinds of schemes are the scammers themselves.
“The simplest way to stay safe is to bear in mind that if anyone is offering incredible overnight returns without risk, it’s a scam.”