Investment frauds

The fraud

These scammers try to get you to invest in fraudulent schemes by promising you’ll get rich quick or that you will double your money in no time. In reality, they take your money and disappear.


Here they are: the three most dangerous words in the English language:

Get. Rich. Quick. Oh… wait… maybe it’s these three:

Double. Your. Money. Ooops – forgot these ones:

Limited. Time. Offer. These words are the most common signs that

you may be in the presence of investment fraud. They’re empty promises, made by criminals,

preying on your desire to do well with your investments and look after yourself and your

family. And by the way, investment fraud is just as

dangerous whether you’re in your twenties, just starting out in the complex world of

investing… or you’re a senior trying to ensure a comfortable

retirement. Look - when it comes to investing:

Beware – of guaranteed high returns, with little or no risk, hot tips,

high pressure sales tactics, or impossible promises.

Be careful of unsolicited investment opportunities -

these can be offered offered over the phone, through social media, or by text messages

from a stranger. Be diligent – research the opportunity through

credible sources, take your time before saying yes,

and be sure the person or organization approaching you is registered.

The Competition Bureau and the Ontario Securities Commission are working hard

so people like you don't become the victims of fraud.

Oh – three more words. Do. Your. Homework. For more information, visit

and To report a fraud, contact

Video length: 1 minute, 57 seconds

How it works

Investment fraud is where someone tries to get you to make an investment decision based on false or misleading information. For example, the scammer may try to get you to buy digital currencies, stocks, bonds, or real estate, or to invest in a business directly.

Some new scams focus on digital currencies including cryptocurrency where fraudsters use social media, dating apps, Internet ads or websites telling you to act now and promising high returns. They may also use classic scams like pyramid schemes and fake or real celebrity endorsements.

How to spot it

Claims of huge returns and high pressure sales tactics are often warning signs that something is too good to be true. Here are four signs that an investment opportunity may be fraudulent:

  1. Claims you can make a lot of money with little or no risk
    In general, high-risk investments offer higher potential returns, and lower-risk investments offer lower potential returns. This is known as the risk–return relationship. For example, when you buy investments like stocks, there’s no guarantee you’ll make money, and you could lose money if the stock price goes down.
  2. Someone gives you a “hot tip” or says they have insider information
    Think about why they’re offering you a tip, and how they benefit by telling you. If the hot tip is false, you may lose your money if you act on it. If it is really insider information about a public company, it may be illegal to act on it.
  3. You feel pressured to make a decision
    Scammers frequently use high-pressure tactics because they want to get your money and move on to another victim. Scammers also know that if you have time to check things out, you may not fall for the fraud.
  4. The seller isn’t registered with the provincial securities regulator
    In general, anyone selling securities or offering investment advice must be registered with a securities regulator in a province or territory.

Protect yourself

  • Be careful of unsolicited investment opportunities offered over the Internet or phone, including a recommendation from a friend on social media or a text message from a stranger.
  • Research the opportunity through credible sources and take your time before making a decision.
  • Make sure you know the risks before investing in cryptocurrency. Cryptocurrency payments do not come with legal protections and the payments are typically irreversible. Keep in mind that if the business is not located in Canada, it may be even more difficult to pursue legal action.
  • Take 5! 5 minutes, 5 hours, 5 days. Fraudsters will try to rush you. Take your time before making a decision.
  • Before you make a decision, verify if the investment companies are registered with your Provincial Securities Agency and check out the company on the National Registration Search Tool.
  • Check to see if a person or company has been flagged as a risk to investors on the Investment Industry Regulatory Organization of Canada and your provincial financial regulators.

Further reading