REMEMBER: If it is too good to be true, it probably is! When in doubt, apply the scam test:
S – seems too good to be true
C – contacted out of the blue
A – asked for personal details
M – money is requested
The following are just some examples of common financial frauds. However, it is important to remember that perpetrators of fraud are constantly designing new ways to target their next victims. For this reason, you should remain vigilant and consider the possibility of fraud, even if the circumstances do not exactly fit one of the below examples. You should also keep an eye out for notices or warnings issued by your local regulator, exchanges or other market participants regarding patterns of fraudulent activity.
Clone Firm Scams:
Scammers may pretend to be from a legitimate firm to get you to transfer money to their account. In some cases, scammers may pretend to represent or be part of a reputable financial services company, including Interactive Brokers. The purpose of a Clone Firm Scam is to get you to transfer your money to an account that appears legitimate but which in fact belongs to the fraudsters.
These scams often involve the fraudster using a reputable firm’s logo or letterhead, adopting names that resemble those of the reputable firm, or even using names and addresses of persons who are associated with the real firm.
Be wary of cold calls or emails you receive requesting money from you. Check to make sure all emails use the firm’s real domain name (for IB, interactivebrokers.ie, interactivebrokers.com or interactivebrokers.co.uk). Be especially careful of any unprompted interactions through social media platforms – Interactive Brokers may promote its general products and services on social media but it will never interact with you through these channels in relation to your account nor prospective account. If you are unsure whether a communication is legitimate, please contact IB Client Services.
Here are some red flags you should watch out for if you are contacted by someone claiming to work for VALOR CAPITAL LTD or be affiliated with us:
Pump-and-Dump or Ramp-and-Dump Schemes: In these schemes, scammers invest in a stock and then spread false or misleading information to create a buying frenzy that will artificially “pump” up the price. They then “dump” their shares at the inflated price, leaving others with losses. Such “hot tips” are often framed as privileged information from people “in the know.”
Scammers often exploit new technologies to spread false or misleading information about a company’s stock price—for example, via messaging apps, social media platforms, and blogs.
Trash-and-Cash Schemes: The opposite of pump-and-dump. Scammers circulate false information to pressure holders of a relatively illiquid security to sell. As the price drops, scammers buy at depressed levels.
Pension Liberation Scam: Fraudsters promise “penalty-free” early access to pension benefits via supposed tax loopholes, then erode accounts through commissions and dubious investments. Early withdrawals often trigger penalties and lasting financial harm.
Affinity Fraud: Scammers pose as members of a group (age, religion, ethnicity, profession, etc.) to build trust, often pushing fake or misrepresented investments. Many of these are Ponzi or pyramid schemes that collapse when new money dries up.
Protect yourself by performing independent research and due diligence before accepting any investment advice or services. Always verify the credentials of the person or company and confirm regulatory authorization using your local regulator’s register.
Holy Grail Scams: Be skeptical of claims of secret, “no-risk” trading systems with guaranteed profits. Extravagant promises and glowing testimonials are red flags—if it sounds too good to be true, it almost certainly is.