An estimated $113 million were lost over the past five years to online-based scams that according to the Australian Crime Commission (ACC) had victimised thousands of Australians.
In a joint report prepared by the ACC and the Australian Institute of Criminology (AIC), as many as 2600 senior Aussies were preyed upon by online investment scams that ACC chief executive John Lawler described as "very sophisticated organisations ... backed with many millions of dollars."
"This is not a backyard enterprise, these are very sophisticated operations sometimes set up in multiple jurisdictions that actually have teams of people whose sole purpose is to set up bank accounts and to set up financial structures to route the money," Mr Lawler told The Australian on Monday.
He added that the illegal operations were usually based in Asia, Europe and the Caribbean and were maintained to convince victims that the transactions were real and legitimate.
The report also noted that many victims were actually financially literate and had investment experiences before, highlighting the apparent sophistication of the criminals' operation.
Normally, victims were picked from social networking sites and brokerage lists, where the scammers obtained their personal data to be used in contacting them via so-called 'cold calls'.
According to Australian Securities and Investments Commission (ASIC) chairman Greg Medcraft, these fraudsters "are skilled at using high-pressure sales tactics over the phone and using emails to persuade their victims to part with their money."
Speaking to reporters in Melbourne today, Home Affairs Minister Jason Clare disclosed that usually "criminal syndicate cold calls the investor, refers them to a flash website and sends them a brochure promising strong investment returns."
Most of the victims, at least in Australia, were over the age of 50.
"Once they've stolen the money the website disappears and the trail goes dead," Mr Clare reported by Agence France Presse (AFP) as saying.
He added that "people's entire life savings are stolen by criminals with the click of a mouse," and the actual amount lost to the scams could be much higher as many victims were too embarrassed to report.
Mr Lawler also pointed out that the millions of losses cannot be recovered as prosecuting the individuals involved "will not be possible ... all of these people in foreign jurisdictions."
But prevention could be the key in stamping out the illegal activities as ACC sets out to inform the Aussie public of the investment fraud, which Mr Lawler said will be conducted by sending letters to households informing them of the danger financial threat.
The project will be in conjunction with Australia Post, which will advise people not to entertain unsolicited phone calls, especially those offering financial investment tools with fantastic returns.
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