Beware Of Financial Imposters On WhatsApp, Other Social Media

Retirement

There’s been a dramatic twist in online imposter scams.

In the traditional imposter scam, the crooks pretend to be a government agency or well-known company. They generally use emails, texts, or phone calls to try to induce targets to part with money or sensitive personal information.

In the latest scams, which so far appear to be mostly on WhatsApp, the crooks set up chat rooms that purport to be hosted by legitimate and sometimes well-known financial advisors.

The chat rooms use information from the legitimate advisor’s web site or social media to give it the appearance of the real thing.

To draw users to the chat room, the crooks initially provide mainstream advice and market commentary.

But after a while, they try to draw users into various scams by mentioning them as additional services that can be offered.

Trading advice in digital currencies and assets is a major offering. Or users might be asked to pay fees for tailored traditional financial advice. Whatever the offer, the services are not legitimate. They’re intended to induce users to part with sensitive personal information or money or both.

The cyberthieves will take the personal information and money but won’t provide the services. Or they will provide bogus services, not services from the professional who the thieves pretend to be.

Investors should know that regulated financial advisors in the U.S. aren’t allowed to use WhatsApp and similar tools to give advice, promote their services, or solicit clients. They also aren’t allowed to use other social media sites to give specific investment advice to individuals.

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