Action Fraud advice for victims of Ponzi Schemes

Ponzi schemes inevitably end up collapsing, as the fraudsters disappear with investors’ money and unfortunately it is unlikely that you will get your money back.

You should report the scheme to Action Fraud and alert your bank – your evidence may help in a subsequent criminal investigation. Also, keep an eye out for other fraudsters targeting you – they can pose as professionals or companies trying to help you recover your lost money, for a fee.

Ponzi schemes rely on you authorising the transfer of money from your bank account to that of the scammers. This is known as Automated Push Payment (APP) Fraud and is becoming increasingly common. If you are thinking of investing as a result of seeing an online advert or a ‘cold call’, carry out these checks first:

• Look up the company’s real website and double check the investment is offered there with the same terms. There are many clone firms operating fraudulent investments.
• Check the website of City watchdog, the Financial Conduct Authority (FCA) to ensure that the company is genuine and look for any reports of fraudulent activity by companies of the same or a similar name.
• Contact the company directly, by telephone or via their website, to double check bank details before you transfer any money. Fraudsters often provide alternative bank account information.

Remember, if the scheme seems too good to be true, it probably is.

Given their experience of different scams and frauds, banks have a duty to protect their customers from scammers and it may be possible to pursue a claim against them in addition to any criminal proceedings against the scammers.

If you think that you or a loved one may have been the victim of a Ponzi scheme and your bank should have done more to protect your money, get in touch with the specialist APP Fraud team at TLW Solicitors.

We understand the time limits to be followed, the information needed and the claims and appeals processes. The team will also deal with any complex legal arguments and defences that the bank may raise. The combination of our experienced team and up to date digital case management systems, means that we proactively pursue your claim and aim to get the best possible results.

Our Head of Professional Negligence, Sarah Spruce, said:

“Scammers use many different techniques, often online, to manipulate their victims into handing over money in ‘get rich quick’ Ponzi schemes. It is extremely important that anyone thinking of making any such investment carries out sufficient due diligence and as a starting point checks whether they are regulated with the FCA. There is plenty of information and specialist help available to avoid being the fraudsters’ next victim.”