From text to pitch: How messaging apps have become a hotbed for investment scams

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A polished social media ad and a friendly invite to an “investors” messaging group might seem like an exciting first step towards a lucrative financial opportunity. But wait, this could be the bait of a well-orchestrated scam. According to the Canadian Anti-Fraud Centre, in 2024, Canadians lost $310 million to investment fraud – with many scams taking place online, including on social media networks.

Fraudsters commonly promote and sell their investment scams to potential victims through advertising on popular social media platforms and apps. These ads commonly promote fake “experts” or “advisors” who offer investment opportunities with high returns and the reassurance of little to no risk.

To connect with potential victims and make communications private and harder to trace or report, fraudsters will direct interested investors to a WhatsApp, Telegram or Facebook Messenger group to receive stock trading tips or guidance. Within these private groups, fraudsters work quickly to establish their fake credentials with the claim of being certified or registered. From here, fraudsters can use various tactics, including:

  • Pump-and-dump schemes that involve guiding investors to invest in stocks that the fraudster is already heavily invested in, using fake information and promotional material to build excitement. As investors put money in, the value of the investment artificially increases. Once the fraudster can no longer pull in any new investors, they sell their shares for considerable profit and tank the value of the investment for everyone else.
  • Providing guidance as an “advisor” and requesting that money be sent to them via wire transfer or crypto for them to invest on your behalf. Once money is sent over, the fraudster may send over fraudulent documents highlighting early but fake returns to establish credibility and incentivize the victim to send more money.
  • Directing investors to a fake trading platform to deposit money and start trading. While the platform looks legitimate with charts and simulated trading, money is not actually invested but taken by the fraudster. The fraudster may use the simulated returns in the investor’s account to push them to invest more for greater returns over time.

No matter what strategy the fraudster deploys, the results are the same for the victim. Investors may:

  • Lose most or all of their “invested” funds.
  • Not be able to access their funds with claims from the fraudster that a tax or fee requires payment, specific forms to be filed or that the investment needs more time to grow.
  • Be unable to contact or receive a reply from the fraudster. This is often followed by the fraudster deleting their account and messages and even shutting down fake trading platforms.

Real investment scam ads advertised to Albertans

Example of facebook investment scam ad Example of social media investment scam ad Example of investment scam ad on facebook example of a whatsapp investment scam ad

 

How can you spot the red flags of social media and messaging app investment scams?

Although it may sound exciting, before you invest in any opportunity promoted online or with someone claiming to be an investment advisor or professional, consider the following:

  • Is the ad promoting unrealistic returns or guaranteed profits? Remember, this is a common tactic to lure in victims. No investment can guarantee you returns, especially those claiming to double or triple your money in a short period of time.
  • Are you being directed to other messaging apps to continue the discussion? This is a red flag that you may be dealing with a fraudster and should be avoided. These messaging apps are used to keep the conversation private and make it easier for the fraudster to disappear and harder to trace.
  • Is the person claiming to be an expert or registered investment professional? Generally, anyone offering investments and all trading platforms dealing with Albertans should be registered with the Alberta Securities Commission. While you can verify the registration of any individual or trading platform, you cannot verify the true identity of a person online. Fraudsters commonly use the names and credentials of registered investment professionals to look legitimate. It is strongly advised that you do not send money to anyone you have not met in person or cannot validate their identity.

 

What should you do if you think you’ve been scammed?

If you are suspicious about an investment opportunity offered to you online through social media or feel like you were the victim of an investment scam, contact the Alberta Securities Commission below.

File a complaint
1-403-355-3888
complaints@asc.ca

 

Recently, the Canadian Securities Administrators launched a national ad campaign, as seen above. This campaign is designed to bring awareness to these kinds of investment scams offered through social media and messaging apps. Knowledge is power when it comes to preventing and reporting investment scams. Take the time to share this article with those you care for so they can be empowered to recognize and avoid this insidious form of investment scam.

Knowledge is power when it comes to preventing and reporting investment scams. Take the time to share this article with those you care for so they can be empowered to recognize and avoid this insidious form of investment scam.

Protecting our seniors: How to prevent elder financial abuse

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June is Seniors Month in Canada, a time to recognize the value, resilience, and continued contributions of older adults in our communities. It’s also an opportunity to talk about one of the fastest-growing threats to their well-being: elder financial abuse.

According to the 2024 CSA Investor Index, 36 per cent of Canadians say they are aware of at least one instance of elder financial abuse, up from 29 per cent in 2020. This rise signals that more Canadians are paying attention to the financial vulnerability of older adults. It is also a reminder that this is a growing issue, and now more than ever, we need to be vigilant and recognize the signs of financial abuse with older loved ones we care for.

The Alberta Securities Commission (ASC) hears firsthand from seniors about how these situations occur.  More often than not, financial abuse is subtle, persistent, and emotionally complex, which is why it can be hard to talk about and even harder to report. Financial abuse may not be immediately obvious, but the earlier it is identified, the better the chance of limiting the damage and preventing it from happening to others.

 

How seniors are being targeted

Financial abuse can take many forms, and fraudsters continue to adapt their tactics to take advantage of seniors. In some cases, they offer seniors what appear to be legitimate investment opportunities, often through cold calls, emails, messaging apps, or social circles. These fraudsters typically work to build trust quickly, using charm, familiarity, or shared interests to gain credibility before making their pitch.

Understanding these tactics is key. Our Fraudsters’ Playbook outlines the common steps scammers follow to build trust, manipulate emotions, and push victims into rushed decisions. The person making the pitch may not be registered to sell investments, may not provide clear documentation, or may urge the senior to act quickly without speaking to anyone else.

Another scam we continue to see is recovery room scams, where victims of previous fraud are contacted by individuals claiming they can help recover their lost funds for a fee. These scams can be especially damaging, as they often exploit a victim’s sense of desperation and hope for financial restitution.

Financial abuse, however, isn’t always the result of fraud. In some cases, it comes from someone the senior already knows and trusts. A family member, caregiver, or close acquaintance may gradually take control of financial decisions, gain access to accounts, or pressure someone into making risky or unfamiliar investments. This type of abuse can be subtle and difficult to identify, especially when it’s framed as support or occurs during a period of emotional or cognitive vulnerability.

With older adults managing their finances more online, fraudsters are using increasingly sophisticated digital tools to manipulate, deceive, and steal. Messaging apps like WhatsApp or social platforms like Facebook are being used to distribute fraudulent investment schemes, sometimes disguised as tips from “trusted” sources, making it harder to recognize the scam until it’s too late.

 

What you can do to help protect seniors

While the methods used to target seniors with investment scams are growing, the steps we can take to protect ourselves and those we care about remain clear and effective.

  • Check registration with CheckFirst: One of the most important things anyone can do before working with an investment professional or firm is to check registration. In Alberta, generally, any individual or firm selling investment products or offering advice must be registered with the ASC or another Canadian securities regulator. If they aren’t, this is a red flag, and there is a risk that the person or firm is operating outside the law.
  • Have a conversation: It also helps for concerned family members or trusted friends to talk openly and respectfully about financial matters, especially with aging loved ones. These conversations can be difficult, particularly when they involve suspicion or concern, but they are often the first step in identifying when something feels off. Asking questions, encouraging second opinions, and sharing reliable resources like ca/Seniors can empower older adults to make informed decisions and recognize red flags early. If someone is experiencing financial abuse, there are organizations and support services that can help. For more information on elder abuse, visit albertaelderabuse.ca.
  • Report it: If you suspect someone is being targeted or has already been affected by investment fraud, please report it to the ASC immediately. While the ASC is not able to address cases of broader financial abuse, we are committed to helping Albertans understand how to invest safely and how to protect themselves from investment fraud. Our checkfirst.ca website provides tools and resources to help Albertans protect their financial well-being, at any age. We want to hear from anyone who believes they have been caught up in an investment scam.

Preventing elder financial abuse is not just the responsibility of seniors–it’s a shared effort. Families, caregivers, neighbours, and financial professionals all play a role in creating an environment where older adults feel safe, respected, and informed about their finances.

As we celebrate seniors’ month, let’s honour the wisdom and contributions of older adults and take meaningful action to protect them from the growing threat of financial abuse and fraud. Together, we can help ensure seniors live with dignity, security, and peace of mind.