What are financial scams?

Financial scams are deceptive schemes designed to trick you into giving away your money.

Scams have a significant impact – for example, Australians lost $1.4 billion to scams between 2020 and 2023.

You can read about some of the real-life stories from people affected by scams, get help if you need it on the Scamwatch website, or contact CoinJar Support if you believe you've been involved in a scam.

Before you send your money anywhere, whether it be to someone else, an investment, or a company, either local or international, remember:

Why are scams dangerous?

Scams can ruin your life

Being tricked by a financial scam can have serious and lasting effects.

You will lose the money you sent, which may have been a significant amount. Your money is impossible to recover because scammers use complex methods to cover their tracks, and there are many challenges involved in tracking your money down.

Beyond the immediate loss of money, the emotional impact can be harsh. It can lead to stress, depression, and a profound sense of betrayal, which may erode your trust in others.

Scams can cost you more than money

Falling victim to a financial scam can shatter your personal relationships as you grapple with the shame and guilt of being deceived. The financial strain can cripple your ability to cover daily expenses, save for future goals, or secure a comfortable retirement.

In extreme cases, the resulting financial instability may force you to borrow desperately from friends and family, or it could lead to total financial collapse, leaving you struggling to afford even the most basic necessities.

Crypto and scams

Scammers trick victims into sending cryptocurrency. This makes scams even more dangerous because once you send your crypto, you can't get it back. Unlike banks, crypto transactions are permanent and have no refunds.

Scammers create urgent and convincing stories to trick people into sending money quickly without checking. The anonymous nature of cryptocurrency makes it almost impossible to catch scammers.

If you send cryptocurrency - it's gone forever.

What are some common scams?

Investment scams

Investment scams often start with an unexpected email, text message or phone call from a stranger. To protect yourself when sending funds from CoinJar, ask yourself:

• Have I received unexpected emails, text messages, or phone calls from strangers?
• Are there offers guaranteeing high returns for a minimal initial investment?
• Have I been asked to pay taxes with funds sent outside of Australia?
• Am I being asked to invest with companies located outside Australia or those without an Australian Financial Services Licence? (Be cautious even if they use the number of an authorised company to seem genuine.)
• Am I receiving persistent or harassing phone calls from international numbers or so-called account managers?
• Have I been allowed to make small withdrawals to build trust and encourage larger investments?

If you answered "yes" to any of these questions, you might be involved in a scam.

Recovery / Refund scams

Recovery scams often occur after falling victim to an investment scam. The scammers may use their knowledge of your involvement in an investment scam to trick you into believing they can recover your money. To protect yourself when sending funds from CoinJar, ask yourself:

• Have I been promised the recovery of funds invested with an overseas company?
• Is the recovery company registered or located in Australia?
• Was I contacted out of the blue or in an unsolicited manner about the recovery by a stranger?
• Am I being required to pay any recovery fees upfront?
• Have I been provided with a templated Alternative Dispute Resolution (ADR) letter?

If you answered "yes" to any of these questions, you might be involved in a scam.

Romance scams

Romance scams often occur through online dating apps and websites, although they can begin over social media, text message, email or phone call. In romance scams, scammers exploit individuals seeking romantic partners. To protect yourself when sending funds from CoinJar, ask yourself:

• Have I been asked or coached to open a CoinJar account?
• Do I have strong feelings for this person, which may make it easy to forget about being cautious about their legitimacy?
• Have I been asked to download remote access software like AnyDesk or TeamViewer on my devices?
• Is the person I'm communicating with currently overseas or claiming to be in Australia?
• Have I only spoken to this person online?
• Have I received requests for emergency funds to be sent via Bitcoin (BTC) rather than AUD?
• Has anyone asked me to deposit small amounts of funds into my Australian bank account to purchase cryptocurrency?
• Has this person asked me to pay for their travel or accommodation?

If you answered "yes" to any of these questions, you might be involved in a scam.

Remote Access scams

Remote access scams often begin with an unsolicited message or phone call that appears to be from a legitimate company, such as your phone or internet service provider. Scammers use this tactic to gain control of your devices and access your personal information. To protect yourself when sending funds from CoinJar, ask yourself:

You can do your own independent research by:

• Searching for the name of the recipient on the web.
• If available, reviewing the recipient's terms of service/privacy policy.
• Checking if the recipient is registered, or holds an appropriate regulatory licence in the region they operate from.
• Reading other people's reviews of the recipient's services.
• Asking a friend or family member to help review the situation and offer a fresh look at the recipient.
• Asking for assistance from the team at your bank or financial institution.

Has a stranger contacted you?

If someone contacts you asking you to become involved in cryptocurrency, ask yourself the following:

• Do I know who this person is?
• Why have they contacted me?
• Have they advised they can make large or high yield returns on my investment?
• Is the service they are referring me to regulated in the country I live in?
• Are they asking for remote access to my device or computer?
• Are they asking me to invest my money, or asking me to transfer money on their behalf?
• Is what they are saying true?

When a stranger contacts you, you should never provide:

• • Remote access to your computer.
  • Information that should be kept private, such as email addresses and/or passwords such as those that grant access to your email inbox or your bank account.
  • Information on your financial status or any personally identifiable information (such as identity documents).

Warning signs

There are some immediate warning signs that you may be involved in a financial scam, including — but not limited to — where a stranger:

• Contacts you via a social media or messaging platform.
• Begins a conversation that quickly steers towards your financial status and getting started with investing.
• Claims that you need to provide them with a fee to release an amount of money they allege you own.
• Alleges you have a debt to pay and must pay it with a sense of urgency.
• Claims that they can make you a profit by making trades on your behalf but the trading platform only supports cryptocurrency.
• Requests remote access to your devices.
• Requests access to your identity documents.
• Requests access usernames/passwords for banking services.

More resources

You can also visit:

• Scamwatch, to check for existing scams or to report a new scam.
• The Australian Cyber Security Center providing up-to-date advice on the latest reported cyber security issues, as well as general advice on staying safe online.
• MoneySmart offering guides on protecting yourself from banking and credit scams, as well as investment scams and companies you should not deal with.

How do I report a scam?

ReportCyber is an official cyber crime reporting service run by the Australian Government. Your report will be passed to law enforcement agencies for assessment and intelligence purposes.

Although not all reports will be investigated by law enforcement agencies, all reports are important as they provide information on the latest cyber-crime activity and trends. You may be contacted by police if additional information is required.

Click here to make a report

If you have any queries or concerns, don't hesitate to submit a new Support request or get in touch with our Support Team on support@coinjar.com.