WhatsApp scam warning as fraudsters steal £2.7m using AI to mimic investment firms and drain accounts

These scams involve fraudsters setting up fake WhatsApp groups, emails, or websites that closely resemble legitimate investment firms, tricking victims into transferring their money.

Nearly 500 such impersonation attempts were reported by Investment Association members, with just under one in four proving successful.

The scam has become the top threat facing consumers looking to invest, the trade body warned.

Adrian Hood, a regulatory and financial crime expert at the association, said criminals would use "a variety of means" to trick people into parting with their money.

He added: "The growth of AI is likely to see increasingly sophisticated scams, with criminals better able to mimic legitimate firms."

The Association said that fraudsters are using AI tools to generate more convincing branding, communication and even fake adviser profiles.

These technologies make it harder for consumers to spot fake investment platforms or messages, particularly when shared in group chats.

Despite the increase in cloning scams, the total amount lost to fraud among Investment Association customers fell by 29 per cent to £5.4 million between the first and second halves of the year. Of this, £1.7 million was recovered.

Other types of fraud, such as account takeovers and card-based investment scams, also fell over the same period.

There were 132 account takeover incidents compared to 142 in the previous half-year, and reports of card fraud dropped from 36 to 17.

UK Finance echoed the concerns around AI-driven fraud, saying that criminals are now going to extraordinary lengths to appear legitimate.

It urged consumers to check the Financial Conduct Authority’s online register to confirm whether a firm is authorised, and only to use the official contact details listed there.

The warning comes during Take Five Week, a national campaign aimed at helping consumers stop and think before transferring money or sharing sensitive information.

Those who believe they’ve been targeted are advised to immediately contact their investment provider and report the incident to Action Fraud, the UK’s national fraud and cybercrime reporting centre.