Intro
Leveraging a globally unique dataset, BrokerChooser experts crafted a research study that examines the rising incidence of online investment scams and the proliferation of financial service providers of questionable reliability in Europe.
Analyzing data garnered from Google search results on 1.3 million articles in 56 languages published by BrokerChooser, the report includes the following key findings:
- Scale of the problem: The study identified 67 not-recommended entities targeting EU citizens, generating 1.3 million Google search impressions from European locations in the first 6 months of 2024.
- Geographical concentration: Five EU member states (Germany, France, Poland, Italy, and the Netherlands) account for 86.4% of the total search volume, indicating either disproportionate targeting or heightened awareness in these regions.
-
Fraudulent tactics: The top 9 most searched entities, confirmed as displaying scam-like characteristics, demonstrate sophisticated operations targeting specific countries and claiming to use artificial intelligence (AI) and other advanced technologies to provide traders with decisive edge over the market.
-
Assets advertised: Cryptocurrency trading dominates the fraudulent offerings, with 6 out of 9 top scammers prominently featuring it. Other offerings include Forex, CFDs, real estate, and precious metals.
- Global reach: The identified scams extend beyond the EU, attracting searches from over 50 non-EU countries.
By casting light on the operational tactics of these fraudulent entities, BrokerChooser aims to convert the abstract notion of “investment scams” into precise, actionable intelligence. Our objective is to equip authorities with data-driven insights that enable more focused and effective enforcement strategies.
Our purpose is to bridge the gap between mere awareness and proactive measures, offering a clear framework for regulators to identify, scrutinize, and prosecute these malicious actors.
Check out the following video for an exclusive panel discussion on the key findings of the research, held by BrokerChooser experts.
BrokerChooser recommendations for fighting investment scams
The proposed recommendations focus on prevention and are addressed to various stakeholders such as regulators, non-governmental organizations (NGOs) and corporate as well as industry actors that have the authority and capabilities to combat this growing threat.
- Integration of regulatory warnings into search engine results: We advocate the development and implementation of a system that incorporates regulatory warning lists into major search engines. This integration would enable the automatic display of prominent warning signs alongside search results featuring entities included in these lists.
- Enhanced scrutiny of digital advertising: We recommend leveraging advanced data analytics techniques to examine the financial transaction data associated with these advertisements. This analysis could provide valuable insights into the individuals or businesses orchestrating these scams, facilitating more effective identification and prosecution of perpetrators.
- Collaboration with domain hosting companies to disrupt fraudulent operations: We propose expediting the process of discontinuing hosting services for URLs associated with identified fraudulent entities or scammers.
- Amplification of regulatory warning lists through public awareness campaigns: we recommend the development and implementation of targeted public awareness campaigns designed to increase the visibility and efficacy of these regulatory warning lists.
The research underscores the urgent need for coordinated action among regulators, technology companies, financial institutions, and other stakeholders to create a more robust defense against online investment scams in the EU. The findings and recommendations aim to foster a safer investment environment and protect EU citizens from financial fraud.
Click on the button below to access the full text of the research.
BrokerChooser has developed a unique tool to help users avoid scams and find the broker that best matches their needs by answering a few easy questions. The database powering our Find my Broker tool only includes brokers that are overseen by a top-tier regulator.
Get a personalized broker recommendation
Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology.
