UK citizens have lost £56 million to investment scams in just six months, according to a Barclays Bank report of a 29% surge in cases over the past year. A second report by BrokerChooser has uncovered that approximately 50 million people in the UK could be at risk of forex (foreign exchange market) scams.
The foreign exchange market is a global decentralized or over-the-counter (OTC) market for the trading of currencies. It is highly volatile and not designed for the casual investor. Foreign exchange risk is the chance that a company will lose money on international trade because of currency fluctuations. This describes the possibility that an investment’s value may decrease due to changes in the relative value of the involved currencies.
The findings are based on a representative panel of 2,000 adults, who were asked how they would respond in four different scam scenarios. Nine in 10 people (91%) said they would act in a way that could expose them to fraud.
In response to the question: “How would you verify the legitimacy of a forex trading opportunity before investing?, this had the highest proportion of respondents selecting risky answers, with almost one in four (23.15%) saying that they would ask the broker directly for copies of their licenses and certificates.
This is a risky approach, since it relies entirely on trusting the word of the broker, who may provide forged or misleading documentation. Scammers often exploit this tactic by creating convincing fake credentials to appear legitimate, making direct engagement a potential trap rather than a form of due diligence.
The survey found that nearly one in three (30.95%)respondents lack confidence in spotting investment scams, with 45 to 54-year-olds (38.8%) being the least confident age group. Women are more risk-aware than men, with just 10% saying they’d test a small deposit in a forex opportunity, compared to 17% of men.
Even where people expressed a degree of confidence, this could be overplayed. Young adults (25-34) are most likely to overestimate their confidence in spotting an investment scam, with many still willing to engage with suspicious platforms
Another scenario question was: “You’re contacted by a new forex investment platform offering returns of 15–20% per month. They mention they are ‘pending regulation’ and already have 2,000 investors. What would you do?”
Despite being the most confident in their scam-spotting abilities, those aged 25 to 34 were the most likely to turn to friends or family to check if they’ve heard of the platform or knew anyone who had invested (35.67%). This is a form of social proof that scammers often exploit, as friends and family can be just as misled, especially when early returns appear convincing.
This age group was also the most likely to say they would test the platform with a small amount (28.35%), with almost a third unknowingly exposing themselves to greater risk. A classic scam tactic, scammers often fabricate early successes to lure people into making bigger investments later.
Krisztián Gátonyi, from BrokerChooser aid in a statement to Digital Journal: “A quarter of young investors admit to making impulsive decisions in order to keep up with current investment trends, often leaving little time to properly evaluate the risks.5 Amid a sharp rise in investment scams, this behaviour is particularly dangerous – especially as fraudsters grow increasingly sophisticated in how they present themselves.”
Gátonyi adds: “With the rise of AI, we’re now seeing realistic fake websites, chatbot ‘advisors’, and even deep fake videos of celebrities endorsing bogus schemes. It’s becoming harder for even seasoned investors to separate genuine opportunities from high-tech fraud. A concerning new study reveals that participants were 22% more likely to invest in AI-enhanced scams than in traditional ones. While younger adults tend to feel more sure of themselves, some are still falling for red flags like promises of unrealistic returns, unregulated platforms claiming to be ‘pending approval’, or pressure to act fast. It’s critical that people learn to pause and verify – checking for official registration with financial regulators and scrutinising contact information. AI may be empowering scammers, but regulation and public education to be vigilant are still our best defence.”
