Super and investment scams target your personal wealth by convincing you to invest in fake schemes and companies. They’re very skilled at convincing you that their scam is real and unfortunately are very widespread, taking many different forms.
A super scam is when someone tries to access your super and withdraw your money. An investment scam is when someone tries to convince you that an investment is real so you invest your money in whatever it is they are offering.
This article will help you stay informed of the most common types of investment scams and arm you with the facts needed to make smart investment decisions. Most of these scams start with an unexpected call claiming to be from a superannuation or financial service organisation.
Common super and investment scams to look out for
- You receive an offer from a financial adviser or a scammer posing as one. The scammer may ask you to agree to a story to ensure the early release of your super and then, acting as your financial adviser, they’ll deceive your super fund into paying out your super benefits directly to them. Once they have your money, the scammer may take large 'fees' out of the released fund or leave you with nothing at all.
- You receive a call or email from a stockbroker offering amazing investment opportunities with high returns and a low risk. In reality, this ‘stockbroker’ is unregistered and intends to steal all the money you invest.
- You receive an insider tip about a company about to take off and are encouraged to buy shares. What appears to be a once-in-a-lifetime opportunity, is simply a pyramid scheme designed to raise money through the investments of many people.
- You’re invited to an investment seminar with free advice, food and drinks. At the event, you’re persuaded to invest in high-risk strategies that turn out to have hidden fees and undisclosed charges. You might also be encouraged to purchase expensive investment strategy books.
COVID-19 and early access to super scams
The Australian Government has recently warned people to be extra vigilant against scammers targeting those financially impacted by the COVID-19 pandemic1. Scammers are taking advantage of people in financial hardship in a variety of phishing scams designed to steal their super, or by offering unnecessary services and charging a fee.
“Scamwatch has received over 2,700 scam reports mentioning the coronavirus with over $1,114,000 in reported losses since the outbreak of COVID-19.”2
Scammers are using fake vouchers, financial assistance claims or general information around COVID-19 as bait to ‘phish’ for your personal information, including your superannuation. They may try to contact you by cold calling, or may send a text message or email containing malicious links. Scammers can disguise themselves as well-known businesses and government agencies such as myGov, the Department of Health and the ATO, to trick you into sharing your personal information. Once they have your details they can pretend to be you and access your super.3
Keep an eye out for any of the following:
- advertisements promoting early access to super
- offers to 'take control' of your super
- offers to move your super to a self-managed super fund (SMSF) so you can access the money
- offers of quick and easy ways to access or 'unlock' super
- asking for your personal and financial information
- luring you into opening malicious links or attachments
- gaining remote access to your computer
- seeking payment for a fake service or something you did not purchase
If you think you’ve been targeted by someone who is trying to access your super early, please contact MLC immediately 132 652, or you can report it to ASIC on their online complaint form or call the ATO on 13 10 20.
Having trouble trying to spot a super or investment scam? How can you help protect yourself from scammers?
The following is a list of key things you should be looking out for to ensure you don’t fall victim to a scammer.
- Never give information about your superannuation to someone who has contacted you, even when you think it is a trusted organisation. This includes offers to help you access your superannuation early under the government’s new arrangements —just hang up and verify their identity by calling the relevant organisation directly. Never provide your account login details to a third party.
- The ATO is coordinating the early release of super through myGov. There is no need to involve a third party or pay a fee to get access under this scheme.
- Don’t click on hyperlinks in text/social media messages or emails, even if they appear to come from a trusted source. MLC will never send you an email asking for your password, or with a direct link to a login page to access your account.
- Always be suspicious of investment opportunities that promise a high return with little or no risk—If it sounds good to be true, then it probably is.
- Check if a financial advisor is registered via the ASIC website. Any person or business offering advice about financial products must hold an Australian Financial Services licence from ASIC.
- If in doubt, you can check MoneySmart’s list of companies you should not deal with. If the company that called you is on the list, do not deal with them.
- Never let anyone pressure you into making decisions about your money or investments and never commit to any investment at a seminar. Always get independent legal or financial advice first.
What to do if you’re worried
We’re committed to protecting your super and investment savings and have strong measures in place to detect suspicious behaviour - but if you believe you may have fallen victim to a scam, please contact MLC immediately on 132 652.
If you receive a suspicious email, do not click on any links or attachments. Please forward it to firstname.lastname@example.org and then delete it. You can also visit the Scamwatch website for more information and examples of scams.
This article has been prepared by NULIS Nominees (Australia) Limited ABN 80 008 515 633 AFSL 236465 (NULIS) as trustee of the MLC Super Fund ABN 70 732 426 024. The information in this article is current as at June 2020 and may be subject to change. The information in this article is factual in nature and does not take into account personal objectives, financial situation or needs.