Avoiding Investment Fraud: What You Need to Know
Fixed income investment fraud is on the rise in Canada, with scammers impersonating trusted financial institutions and insurance companies to offer fraudulent investment opportunities. These scams often target individuals looking for safe and stable investments, such as Guaranteed Investment Certificates (GICs) and savings bonds, by promising higher-than-normal returns. Victims are typically lured in through online ads that claim to match them with the best investment rates, after which they receive calls or emails from fraudsters posing as legitimate financial advisors. These criminals use brand spoofing tactics, including fake websites, documents, and email addresses, to appear credible and pressure victims into transferring money.
The impact of these scams is growing at an alarming rate. In 2023, Canadians reported losing $309.4 million to investment fraud— the highest reported losses to the CAFC in 2023.(CIRO, 2024). This surge underscores how increasingly sophisticated fraudsters have become, exploiting trust in well-known financial institutions and investment products.
Once a victim has invested, fraudsters may provide phony account statements to create the illusion of a real investment. Eventually, communication stops, websites disappear, and victims realize they have lost their money. The CAFC and financial regulators have issued warnings about this growing scam, urging investors to verify all offers before making any financial commitments.
What’s New? (Latest Scam Trends & Updates)
How to Protect Yourself: Tips from the CAFC
1. No Investment is Risk-Free – Be Skeptical of High Returns
Scammers frequently promise higher-than-normal returns to lure investors into fake fixed-income products. However, legitimate GICs and savings bonds do not offer unusually high returns—any investment that guarantees “risk-free” high earnings should raise suspicion.
One common tactic is offering an initial small return to build trust, only to pressure victims into larger investments. Eventually, the scammers disappear, taking all invested funds with them.
What You Can Do: Compare advertised returns with official rates from your bank or financial institution. Fraudulent investments are designed to look legitimate—always verify offers through trusted financial sources before committing.
2. Never Share Personal or Banking Details
Fraudsters often ask for personal and banking information under the pre-tense of setting up an investment account. This information can be used for identity theft or unauthorized financial transactions.
Victims may receive calls or emails from scammers posing as legitimate investment advisors, asking for bank details, SIN numbers, or even copies of personal identification documents.
What You Can Do: Legitimate financial institutions will never request sensitive financial details over unsolicited phone calls, emails, or online ads. If you receive such a request, verify directly with the institution using their official website or phone number.
3. Be Wary of “Investment Finder” Ads
Scammers often use misleading online ads to collect personal details of potential investors. These ads claim to match users with the “best fixed-income rates”, but in reality, they are used to identify potential victims for fraudulent investment scams.
Individuals who enter their information into these platforms are later contacted by scammers posing as financial advisors, using high-pressure tactics to convince them to invest immediately.
What You Can Do: Avoid third-party investment finders and instead visit financial institutions’ websites directly. If an offer comes from an unknown source, verify it with your bank or securities regulator before engaging.
4. Check Registration – Verify Before You Invest
Scammers often impersonate real investment firms and advisors, making it difficult for investors to distinguish between legitimate and fraudulent offers. They use fake credentials, spoofed websites, and phony email addresses to appear credible, tricking victims into believing they are dealing with a regulated financial professional.
What You Can Do: Never rely on phone numbers, emails, or links provided in unsolicited messages. Instead, verify the advisor or company’s registration through the Canadian Securities Administrators (CSA) or your provincial securities regulator before making any investment.
Check registration here: CSA Registration Search
5. Check Investor Warnings – Watch Out for Fake Ads and Branding
Fraudsters use deceptive ads and branding to make their scams appear legitimate, often running online campaigns that claim to offer high-return, risk-free investments. These scams frequently feature fake regulatory endorsements, AI-generated videos, or misleading social media posts to attract investors.
In a recent case, scammers misused the branding of the Australian Securities and Investments Commission (ASIC) on social media, making fraudulent investment schemes appear government-approved. These fake ads created a false sense of security, leading investors to believe they were dealing with a regulated and trustworthy entity. In reality, they were engaging with scammers who had no connection to ASIC or any legitimate financial institution.
Read more about it here: ASIC Scam Alert
In addition to investment fraud, criminals have exploited similar tactics in funeral and memorial scams, where they pose as grieving families or funeral homes to solicit fake donations. Learning how fraudsters manipulate emotions and urgency can help you spot these scams early.
Read more about how scammers exploit grief here.
What You Can Do: Be skeptical of investment ads that claim regulatory approval—fraudsters often misuse trusted names and logos to create false credibility. If a company claims to be backed by a financial regulator, verify this directly on the regulator’s official website before engaging.
Download the tip-sheet below. Feel free to post and share it to help spread awareness and protect others from these scams.
Final Thoughts: Stay Safe While Investing
Fixed-income investment fraud is becoming more sophisticated, with scammers spoofing real institutions, creating fake comparison sites, and pressuring victims into quick decisions. By staying vigilant, verifying companies through official sources, and avoiding unsolicited investment offers, you can protect yourself from falling victim to these scams.
If an investment opportunity seems too good to be true, it probably is. Always research before you invest, and report suspicious activity to financial regulators.
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