Top 10 Investment Scams in Singapore: How to Identify and Avoid Them

The rise of digital finance and online investment platforms has led to an increase in investment scams in Singapore, with Ponzi schemes and fake Initial Coin Offerings (ICOs) among the top threats. Therefore, it is essential for consumers to stay vigilant and know the warning signs of investment scams. According to the Singapore Police Force, over 470 online trading scam cases have been reported in Singapore since the start of 2025, with losses amounting to at least SGD 32.6 million (about USD 24.1 million).

With more people looking to grow their wealth and earn passive income, investing has become a popular trend—especially among beginners. This surge in interest has also led to a rise in investment scams. Scammers commonly prey on those who may not yet have the experience to spot red flags through social media, messaging apps and dating platforms.

If you’re new to investing, it’s essential to recognise fake investment opportunities and how investment scams work before it’s too late. This guide highlights 10 common types of investment fraud in Singapore and their warning signs.

Types of Investment Scams

Numerous instances of financial fraud, such as cryptocurrency scams, Ponzi and pyramid schemes, and fraudulent trading platforms, have been reported in Singapore. Often these scammers take advantage of the country’s high internet penetration and increasing interest in financial markets to lure unsuspecting investors. Let’s discuss the 10 types of investment scams that are statistically prevalent in Singapore.

1. Ponzi Schemes

A Ponzi scheme is a fraudulent investment scheme in which cash from new investors, rather than real business profits, is used to pay returns to previous investors. When there aren't enough new investors to support dividends, these scams fall apart.

Red Flags:

Promises of guaranteed high returns with minimal risk – In the real world, no investment is risk-free. If someone promises easy money, be suspicious.
Lack of transparency on how profits are generated – If you ask, “How do you generate these returns?” and the answer is vague or overly complicated, that's a red flag.
Difficulty withdrawing funds or sudden account freezes – At first, you might be able to withdraw small sums, but there will be delays as soon as you attempt to withdraw larger amounts.
Pressure to bring in new investors – If they encourage you to recruit others, it’s likely a scam.

One of the largest Ponzi schemes in Singapore was Envy Global Trading, where investors lost over S$1 billion. The company promised high returns from nickel trading, but in reality, it was simply using new investors' money to pay earlier ones.

Rule of thumb: if an investment seems too good to be true, it most likely is. Before investing your hard-earned money, always do your research and see if the company is regulated by the Monetary Authority of Singapore (MAS) or verify its credibility through our Business TrustScore Ratings and Reviews.

2. Pyramid Schemes

Pyramid schemes might look like legitimate business opportunities at first, but they’re built on a fundamentally flawed model of recruitment, not real investment or sales. Unlike a Ponzi scheme (where money from new investors pays old investors), pyramid schemes require you to bring in new people to keep the system going.

The catch? The only way to make money is by constantly recruiting others, not by selling a real product or service. Eventually, the structure collapses because there aren’t enough new recruits to sustain payouts.

Imagine a pyramid-shaped tower. The first people in (the ones at the top) get money from those below them. But as the pyramid grows, more and more people at the bottom have to keep recruiting to support those above them. At some point, recruitment slows down, and the whole thing crumbles—leaving those at the bottom with huge losses.

Red Flags:

Heavy emphasis on recruitment rather than actual investments
No clear, tangible product or service
High-pressure tactics to sign up quickly - Scammers often use high-pressure sales tactics, saying things like, “You’re missing out on an exclusive opportunity/deal”
Unverified or exaggerated income claims - They might flash photos of luxury cars or talk about people getting rich overnight, but they won’t show solid proof of actual profits.
Upfront fees - Often, you’ll be asked to invest in a “starter kit” or pay membership fees before you even see returns.

The Singapore government strictly prohibits pyramid schemes under theMulti-Level Marketing and Pyramid Selling (Prohibition) Act. Any scheme that relies more on recruitment than actual sales is illegal.

Rule of thumb: If you’re being asked to pay money just to “join” an opportunity or recruit others to make a profit, walk away. Real investments don’t work that way.

3. Pump-and-Dump Scams

Pump-and-dump scams are a classic market manipulation trick, especially in stocks and cryptocurrencies.

Here’s how they work: scammers hype up a cheap, low-value asset—often a penny stock or a little-known cryptocurrency—by spreading false or exaggerated claims about its potential.

As more investors rush in, the price skyrockets. Then, the scammers dump their shares or tokens at the peak, cashing out while unsuspecting investors are left holding worthless assets when the price inevitably crashes.

It’s the investment equivalent of being tricked into a bidding war for a cheap item, only to realise later that it was never worth much in the first place.

Red Flags:

Sudden hype around a little-known stock or cryptocurrency - If a previously unheard-of investment is suddenly being talked about everywhere, be cautious.
Aggressive promotions on Telegram, WhatsApp, or social media groups - Scammers often use online forums to push their fake success stories to lure their victims.
Lack of credible financial information about the asset - A legitimate investment should have a solid track record and real financial reports, not just hype.
Unrealistic claims of massive upcoming gains - If someone says, “This coin will 100x in a week!”—that’s your cue to run.

The Singapore Exchange (SGX) and the Monetary Authority of Singapore (MAS) actively monitor stock manipulation and have issued warnings about crypto-related fraud. Several cases of pump-and-dump scams involving cryptocurrencies have been reported in Singapore, often spread through online chat groups.

The rule of thumb: If an investment is being hyped up as a "sure-win," take a step back and think. Real investments grow based on fundamentals, not on social media hype.

4. Fake Initial Coin Offerings (ICOs) and Cryptocurrency Scams

With the rise of cryptocurrency, scammers have found new ways to trick investors—one of the most common being fake ICOs (Initial Coin Offerings). An ICO is similar to an IPO (Initial Public Offering) in traditional finance, but instead of company shares, investors buy newly issued digital tokens.

The problem? Many of these ICOs are completely fraudulent, with crypto investment risks being extremely high. Scammers often create a flashy website, publish an impressive-sounding whitepaper, and promise revolutionary technology or sky-high returns. Once they’ve collected enough funds, they vanish—leaving investors with worthless tokens.

Beyond ICOs, scammers also run fake crypto trading platforms, Ponzi-like crypto investment schemes, and phishing scams that steal users’ digital assets. Because cryptocurrency transactions are decentralised and irreversible, victims often have no way of recovering their money.

Red Flags:

No clear whitepaper or vague project details - A real crypto project should have a well-researched whitepaper that explains its purpose, technology, and business model. If it’s full of technical jargon but lacks real substance, be wary.
Anonymous developers with unverifiable credentials - If the team behind the project doesn’t have a transparent track record, it’s a red flag. Many scam ICOs feature fake LinkedIn profiles or stolen photos of real professionals.
Claims of guaranteed returns in highly volatile markets - Crypto is known for its volatility. If someone promises fixed or absurdly high returns, they’re lying.
Unlicensed or unregulated trading platforms - Many scam exchanges pop up, lure investors in, and disappear overnight. Always check if a platform is registered with financial regulators.

The Monetary Authority of Singapore (MAS) maintains an Investor Alert List that flags unregulated investment platforms targeting Singaporeans. It has also warned against unlicensed crypto exchanges and scams. In 2022, Singaporean investors lost millions to fake crypto investment platforms promoted through social media and phishing attacks.

Rule of thumb: The best way to avoid crypto scams is that if a crypto project seems too good to be true, do your research. Check for regulatory approvals, verify the team, and never invest based on hype alone.

5. Forex and Binary Options Scams

Foreign exchange (forex) trading and binary options are legitimate financial instruments, but they are also common targets for scammers. Fraudulent forex trading platforms and binary options scams lure investors in by promising easy money through “expert signals” or “automated trading systems” that claim to guarantee profits.

Here’s how the scam typically works: Investors deposit money into an unregulated trading platform. At first, they might see impressive (but fake) profits on their accounts, which builds trust. However, when they try to withdraw their funds, they face unexpected fees, delays, or even account closures. In some cases, the scam platforms manipulate trades so that investors lose everything—forcing them to deposit even more money in a desperate attempt to recover their losses.

Binary options scams are even more deceptive. Binary options work like a simple “yes/no” bet on whether an asset’s price will rise or fall within a short period. Scammers manipulate results so that investors always lose in the long run, making it impossible to cash out.

Red Flags:

Unlicensed trading platforms with no MAS regulation - A legitimate forex broker must be registered with the MAS. If a platform isn’t registered, it’s a red flag.

Promises of high, risk-free returns through “secret” trading strategies - Forex and binary options are highly volatile. Any claim of “guaranteed” profits is a lie.

Suspiciously positive testimonials - Many scam platforms use fake reviews or fabricated success stories to appear credible.

Unexpected fees when attempting to withdraw funds - If a platform makes excuses, demands additional payments, or delays withdrawals, it’s likely a scam.

In 2021, MAS issued warnings about unlicensed forex brokers targeting Singaporeans with fraudulent schemes. The Investor Alert List includes many of these suspicious platforms. Some victims reported losing their entire life savings after falling for these scams.

Rule of thumb: If you’re considering forex trading, always check if the broker is licensed by MAS. Avoid platforms that sound too good to be true—because they probably are.

6. Unlicensed Investment Advisers and Fake Trading Bots

Scammers often disguise themselves as expert traders or claim to have “AI-powered trading bots” that can generate guaranteed profits with minimal effort. They target investors—especially beginners—by promising high returns through sophisticated algorithms or insider trading strategies.

The catch? Investors must deposit their funds into a platform or trading account controlled by the scammers. Once the money is in, the fraudsters either manipulate fake profits to convince victims to invest more or simply disappear with the funds.

Fake trading bots are particularly dangerous because they appear to use advanced technology. Some platforms even allow users to see simulated trades, making it look like their money is growing. However, these “profits” are often just numbers on a screen, and when investors try to withdraw, they either face endless delays or find their accounts frozen.

Red Flags:

No verifiable track record or financial license - A legitimate fund manager or adviser in Singapore must be licensed by MAS.

Over-reliance on testimonials instead of real financial data - Scammers often showcase fake success stories but fail to provide proper audit reports or financial statements.

No clear explanation of trading strategies - If they can’t explain how their system works—or it sounds overly complex and vague—it’s likely a scam.

Investors have no direct control over their funds - If you're required to hand over full control of your money without transparency, that’s a huge red flag.

MAS requires all financial advisers and fund managers in Singapore to be licensed and registered. Unlicensed investment advisers or platforms promising “AI trading bots” have been flagged in past scams, where Singaporeans lost thousands after being lured into high-return schemes with no regulatory oversight.

Rule of thumb: If someone claims they can trade for you but refuses to show proof of MAS licensing, don’t trust them. Never invest in a platform where you don’t have full control over your funds.

7. Advance Fee Fraud

Advance fee fraud is a classic scam where fraudsters trick investors into paying upfront fees for investment opportunities, loans, or “guaranteed” high returns. The scammers promise exclusive access to lucrative deals, often claiming that the fee is for processing, legal paperwork, or securing a special investment rate. However, once the victim makes the payment, the scammer vanishes, and the promised investment never materialises.

This scam is particularly dangerous because it preys on individuals who are eager to seize a financial opportunity, whether it’s a high-return investment, a business loan, or even a property deal. Some fraudsters also pose as legitimate financial institutions, sending official-looking documents and emails to appear credible.

Red Flags:

Requests for upfront payments - Legitimate investment firms do not require advance fees just to participate.
Claims of exclusive or limited-time opportunities - Scammers pressure victims to act fast, preventing them from conducting proper due diligence
No official company registration details - Always check if the investment firm is licensed by MAS and verify their business registration.
Excuses when asked for a refund or additional documentation - Scammers will stall or give vague answers when questioned about legitimacy.

The Singapore Police Force (SPF) has issued multiple warnings about advance fee fraud, particularly in cases involving fake bank loans and investment deals. Many victims have lost significant sums by transferring money to scammers posing as financial institutions or private lenders.

Rule of thumb: Never pay upfront fees for investment opportunities or loans. Always verify the legitimacy of any company with MAS and seek financial advice before committing.

8. Fake Real Estate Investment Scams

Real estate is seen as a stable and lucrative investment, making it an attractive target for scammers. Fake property investment scams often involve overseas developments, luxury condos, or exclusive “off-market” deals that promise high rental yields or guaranteed capital appreciation. Victims transfer money, believing they’re securing a prime property, only to later realise that the development either doesn’t exist or was never for sale in the first place.

These scams are typically promoted through social media ads, seminars, or fake real estate agencies. Some scammers even provided forged documents and staged virtual tours to make the deal appear legitimate.

Red Flags:

Unrealistic rental yield promises or guaranteed capital appreciation - Real estate values fluctuate, and no one can guarantee returns. If the numbers seem too good to be true, they probably are.

No ability to physically inspect the property - Scammers often claim the property is overseas or in an exclusive development to prevent inspections. Always verify in person or through a trusted local agent.

Missing or fake ownership documents - Always request official land titles and verify them with the relevant authorities before making any payment.

Pressure to invest quickly without due diligence - If you’re being rushed to sign a deal or make a deposit before verifying details, take a step back.

The Council for Estate Agencies (CEA) regulates real estate transactions in Singapore. They advise investors to verify property ownership and the legitimacy of real estate agents before committing to any deal. There have been past cases of Singaporeans losing large sums to fake overseas property investments.

Rule of thumb: Always verify property ownership through official channels, conduct background checks on the developers, and never make payments to personal accounts.

9. Social Media and Influencer Investment Scams

With the rise of social media, scammers have found new ways to target unsuspecting investors, especially younger audiences, who are eager to grow their wealth. Fraudsters use platforms like Instagram, TikTok, and Telegram to promote fake investment schemes, often through influencers, anonymous accounts, or bots. These scams range from bogus forex trading and crypto investments to fake stock-picking services.

Scammers typically flaunt a flashy lifestyle such as luxury cars, expensive watches, and “proof” of their massive profits to convince people that their investment method works. Some even pay influencers to promote these scams without fully understanding the legitimacy of what they’re endorsing. Once victims transfer their money, the scammer either disappears or keeps making excuses about why withdrawals aren’t possible.

Red Flags:

Influencers or anonymous accounts pushing investments without details - If an influencer is promoting an investment but can’t explain how it works, it’s a red flag.

Direct messages from unknown users offering investment “opportunities” - Legitimate financial firms don’t randomly DM people to offer secret investment deals.

Paid promotions without credible financial backing - Just because an influencer promotes something doesn’t mean it’s real. Check if the investment is regulated and legitimate.

Fake testimonials and photoshopped profit screenshots - Many scammers post manipulated screenshots of their “earnings” or use bots to flood comment sections with fake success stories.

The Singapore Police Force (SPF) has reported a sharp rise in investment scams promoted through Instagram and Telegram groups. Victims have lost thousands after trusting social media personalities who unknowingly or deliberately endorsed these fraudulent schemes.

Rule of thumb: If an investment opportunity is promoted by an influencer, verify if they have real financial credentials. Always check if the company is licensed by MAS before investing.

10. Romance Investment Scams (Pig Butchering Scams)

Romance scams have evolved beyond just emotional manipulation. Many now involve elaborate investment fraud, also known as pig butchering scams. In these schemes, scammers build an online relationship with their victims over weeks or months, gaining their trust before introducing them to a “great investment opportunity.”

These scams are often linked to fake cryptocurrency trading platforms, where victims believe they are making money, only to lose everything when they try to withdraw their funds.

Fraudsters typically meet victims on dating apps, social media, or even messaging platforms like WhatsApp and Telegram. They pretend to be successful traders or business professionals and slowly introduce investment opportunities as a way to “help” their new romantic interest. Victims are encouraged to invest small amounts at first, and the scammers manipulate the platform to show fake profits, convincing them to invest even more. Eventually, when the victim tries to cash out, the scammer disappears, or the platform suddenly claims there are additional “withdrawal fees.”

Red Flags:

An online acquaintance suddenly offers to “help” you invest - If someone you just met online is eager to discuss investments, be cautious.
They direct you to an unknown trading platform - Fake platforms are often unregulated, with no proper licensing. Always check MAS’ Investor Alert List before investing.
You are encouraged to invest more after a small initial “win” - If an investment seems to be generating quick, easy returns, it's likely a trap.
Communication stops once you try to withdraw funds - If someone disappears or suddenly makes excuses about why you can’t access your money, it’s a clear scam.

In 2023, Singaporean authorities reported a sharp rise in romance investment scams, with some victims losing millions. Many cases involved scammers posing as wealthy foreigners or crypto traders, leading victims to fake platforms that appeared legitimate but were actually designed to steal their money.

Rule of thumb: If someone you’ve never met in person starts talking about investments, be sceptical. Never transfer money to a platform without verifying its legitimacy through MAS or other official sources.

Read up on more information on Love Scams.

Investment Scam Prevention: What’s Being Done to Protect Investors?

Investment scams are on the rise, and frauds are getting smarter by the day. From Ponzi schemes to romance investment scams, investors are at greater risk of losing their hard-earned money. To fight back against such trading scams, countries and governments around the world are doing their part to protect investors from falling prey to investment frauds.

Regulatory and Legal Frameworks:

To reinforce the protection law surrounding investments and to protect investors, governments around the world have come up with regulations to crack down on investment scams. In Singapore, the Monetary Authority of Singapore (MAS) has multiple resources available (i.e. Financial Institutions Directory and Register of Representatives) to check whether the company offering the investment opportunity is regulated. To regulate investment activities, the government also came up with the Securities and Futures Act and the Financial Advisors Act.

Public Awareness and Education

One of the best ways to counter investment scams is through education. The Singapore Police Force(SPF), MAS and the Investor Alert List have come up with multiple warnings of suspicious entities. There have also been published advisories on legal actions when dealing with investment scams. “Scam Alert” campaigns have also been useful in helping remind the public to recognise investment scam red flags and to stay safe when investing.

Preventing Investment Scams Through Technology and AI

Governments and financial institutions are starting to leverage technology and AI to help fight against investment fraud schemes. Potential scams can be flagged out early to prevent investors from progressing any further. Banks and fintech companies also use real-time fraud detection systems to monitor any unusual activity.

Partnerships Between the Authorities and Private Sectors

To facilitate scam prevention, the Anti-Scam Command (ASCom) of the Singapore Police Force has expanded its partnerships with more than 110 institutions including banks, financial institutions and overseas law agencies. The strengthening of such partnerships has helped to freeze bank accounts that are suspected to have fallen for scams.

Read up more on what is being done to protect you from scams.

Warning Signs and How to Recognise Investment Scams: Questions You Should Ask Yourself:

Is the investment platform licensed?
Check if the company or platform is licensed by the Monetary Authority of Singapore (MAS). You can verify this through the Financial Institutions Directory or the Investor Alert List mentioned above.
Are the returns too good to be true?
No legitimate investment guarantees high returns with zero risk. If it sounds too good to be true, it probably is.
Who is behind the investment?
Research the individuals or companies involved. Be wary of anonymous developers, fake testimonials, or unverifiable credentials.
How is the money being handled?
Never transfer funds to personal bank accounts, crypto wallets, or third-party payment services without proper due diligence.
Are you being pressured to act fast?
Scammers use urgency to prevent you from thinking critically. Always take your time to verify investment details before committing.
Can you withdraw your money easily?
If a platform or adviser makes excuses when you try to withdraw funds, it's a major red flag.

Stay one step ahead!

If you suspect an investment scam, report it to the Singapore Police Force or check with MAS before making any commitments. Share this checklist with friends and family to help them avoid falling victim to scams!

Want more tips on safe investing? Stay updated on more resources on scams to equip yourself with relevant knowledge and protect yourself from falling prey to scams.

Stay Vigilant and Invest Wisely

Investment scams are getting more sophisticated, and it's easy to see why so many people fall for them—who wouldn’t want an easy way to grow their money? But the truth is, fraudsters know exactly how to take advantage of that dream. Whether it's through flashy social media posts, fake trading platforms, or even someone pretending to care about you, these scams all have one thing in common: promises that sound too good to be true.

The best way to protect yourself? Stay informed, ask questions, and don’t rush into anything. Always check, look out for red flags, and follow a scam prevention checklist before putting your money anywhere. If something doesn’t feel right, trust your gut—it’s better to walk away than to lose everything.

Don’t fall victim to investment scams! Let us help.

If you ever come across a suspicious investment, report the scam so others don’t fall for the same trap. And don’t forget to share this with your friends and family—because when it comes to scams, knowledge is the best defence.

Stay updated, stay safe, stay alert to scams and invest wisely.