SCAM SPOT: Hobbying investors are a rich target for scammers

Ben Young
09:15am April 15 2025

As men enter the sunset years of their lives they often find themselves with more time on their hands. They may have retired or are approaching retirement and the kids have grown up and left home.

Many take up a new hobby to keep themselves occupied. It could be chess in the park, a game of bowls, or an early morning dip in the ocean with friends. 

Or they could decide that they want to make a few extra bucks by dabbling in the financial markets - and that’s where potential trouble lies in wait. 

Investment scams remain the biggest source of loss for Australians by a huge margin. And older men are significantly over-represented among victims.
 

Chart shows age profile of investment scam victims. 


In some relationships, and particularly in the older generations, it could be that the man manages finances. But most of us make better decisions when we use someone as a sounding board. Everyone of every sex should independently have a good sense of how their money is being invested. Ask what is being invested in, and how they know for sure it is who they think it is.

But there is another factor. Some older Australians decide that investing and beating the market will be their new retirement hobby: "I've been interested in this crypto thing for years, that everyone is talking about. Now I've got some spare time on my hands, I'm keen to get involved." Trust me scammers are waiting for you. There are a lots of us that get over-confident in our DIY research and financial knowledge. I have seen investment scam victims who are doctors, lawyers, accountants, even financial advisors.

A scammer will happily call you up and painstakingly walk you through each page of their prospectus.  When they are about to take 100 per cent of your money forever, they will give you all the time in the world.  And please ignore accents, they are not a sign of credibility. Many victims talk of 'posh British accents' as being part of the reason they fell for something.

Here are a few other things that are absolute give-aways that you or your partner are being scammed. If these sound familiar you need to take action:

You have to deposit more money to release money. This story is used in many scams and is always a scam. There is no legitimate investment on earth that requires this, yet victims fall for it all the time. People think "I've come this far, I need to see it through," and most can't stop throwing good money after bad.

Your adviser tells you what to say to the bank. "If the bank asks you what the payment is for, tell them it is for 'blah blah'." Banks are pretty thick-skinned and work hard to earn the right to retain our customers funds. You won't offend us if you say you have found a better deal and won't hurt our feelings.

Unrealistic returns. I see many victims who were promised 20 per cent returns, which is well above where most credible returns are right now. Even if they offer 6 per cent or 8 per cent, go and check how likely that is for a term deposit if the general market is offering 4.5 per cent.

If you are dealing with a major financial institution be 100 per cent sure that you really are dealing with that organisation. Scammers can easily look up who works at a company and then send you emails saying their name is Dave Smith from XYZ Bank and produce fake documents that perfectly resemble bank letterhead. I frequently see victims that say they Googled the name of their advisor, and he does work there. That doesn't mean anything.

The truth is that many of us do a bit of Google research and get over confident in our level of knowledge. And many who are right now being lured into an investment scam would not watch a scam education video from their bank. But you did! So, if your father or husband has decided to get into investing as a hobby take an interest in what they are doing - It might save them a whole world of trouble.
 

Ben Young

Ben Young is Westpac’s Head of Fraud Prevention. Ben’s team researches and operates Westpac’s key fraud protection processes for the ~25 million transactions processed each day by the bank, particularly around credit cards, internet banking, branch and applications for credit. Ben has been intimately involved in Westpac’s anti-fraud processes since 2007 and has worked in various data led risk processes since 1997.

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