Baselinvest.com Review Is Basel Invest Scam or Legit HYIP

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SCAM WATCH

Investment schemes involve getting you or your business to part with money on the promise of a questionable financial opportunity.

Common types of investment scams

Investment cold calls

A scammer claiming to be a stock broker or portfolio manager calls you and offers financial or investments advice. They will claim what they are offering is low-risk and will provide you with quick and high returns, or encourage you to invest in overseas companies. The scammer’s offer will sound legitimate and they may have resources to back up their claims. They will be persistent, and may keep calling you back.

The scammer may claim that they do not need an Australian Financial Services licence, or that that they are approved by a real government regulator or affiliated with a genuine company.

The investments offered in these type of cold calls are usually share, mortgage, or real estate high-return schemes, options trading or foreign currency trading. The scammer is operating from overseas, and will not have an Australian Financial Services licence.

Share promotions and hot tips

The scammer encourages you to buy shares in a company that they predict is about to increase in value. You may be contacted by email or the message will be posted in a forum. The message will seem like an inside tip and stress that you need to act quickly. The scammer is trying to boost the price of stock so they can sell shares they have already bought, and make a huge profit. The share value will then go down dramatically.

If you invest you will be left with large losses or shares that are virtually worthless.

Investment seminars

Investment seminars are promoted by promising motivational speakers, investment experts, or self-made millionaires who will give you expert advice on investing. They are designed to convince you into following high risk investment strategies such as borrowing large sums of money to buy property, or investments that involve lending money on a no security basis or other risky terms.

Promoters make money by charging you an attendance fee, selling overpriced reports or books, and by selling investments and property without letting you get independent advice. The investments on offer are generally overvalued and you may end up having to pay fees and commissions that the promoters did not tell you about. High pressure sales tactics or false and misleading claims are often used to pressure you into investing, such as guaranteed rent or discounts for buying off the plan.

If you invest there is a high chance you will lose money.

Visit ASIC’s MoneySmart for more information about investment seminar scams.

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Superannuation

Superannuation scams offer to give you early access to your super fund, often through a self-managed super fund or for a fee. The offer may come from a financial adviser, or a scammer posing as one. The scammer may ask you to agree to a story to ensure the early release of your money and then, acting as your financial adviser, they will deceive your superannuation company into paying out your super benefits directly to them. Once they have your money, the scammer may take large ‘fees’ out of the released fund or leave you with nothing at all.

You cannot legally access the preserved part of your super until you are between 55 and 60, depending what year you were born. There are certain exceptions such as severe financial hardship or compassionate grounds – but anyone who otherwise offers early access to your super is acting illegally.

Visit ASIC’s MoneySmart for more information about how super works.

Warning signs

  • You receive a call, or repeated calls, from someone offering unsolicited advice on investments. They may try to keep you on the phone for a long time, or try and transfer you to a more senior person. You are told that you need to act quickly and invest or you will miss out.
  • You receive an email from a stranger offering advice on the share price of a particular company. It may not be addressed to you personally, and may even give the impression it was sent to you by mistake.
  • An advertisement or seminar makes claims such as ‘risk-free investment’, ‘be a millionaire in three years’, or ‘get-rich quick’.
  • You are invited to attend a free seminar, but there are high fees to attend any further sessions. The scammer, posing as the promoter, may offer you a loan to cover both the cost of your attendance at the additional seminars and investments.
  • You see an advertisement promising a quick and easy way to ‘unlock’ your superannuation early.

Protect yourself

  • Do not give your details to an unsolicited caller or reply to emails offering financial advice or investment opportunities – just hang up or delete the email.
  • Be suspicious of investment opportunities that promise a high return with little or no risk.
  • Check if a financial advisor is registered via the ASIC website. Any business or person that offers or advises you about financial products must be an Australian Financial Services (AFS) licence holder.
  • Check ASIC’s list of companies you should not deal with. If the company that called you is on the list – do not deal with them.
  • Do not let anyone pressure you into making decisions about your money or investments and never commit to any investment at a seminar – always get independent legal or financial advice.
  • Do not respond to emails from strangers offering predictions on shares, investment tips, or investment advice.
  • If you feel an offer to buy shares might be legitimate, always check the company’s listing on the stock exchange for its current value and recent shares performance. Some offers to buy your shares may be well below market value.
  • Never commit to any investment at a seminar – always take time to consider the opportunity and seek independent financial advice.
  • If you are under 55, watch out for offers promoting easy access to your preserved superannuation benefits. If you illegally access your super early, you may face penalties under taxation law.

Have you been scammed?

If you think you have provided your account details to a scammer, contact your bank or financial institution immediately.

We encourage you to report scams to the ACCC via the report a scam page. This helps us to warn people about current scams, monitor trends and disrupt scams where possible. Please include details of the scam contact you received, for example, email or screenshot.

Scams that relate to financial services can also be reported to ASIC.

Spread the word to your friends and family to protect them.

High-Yield Investment Program (HYIP)

What Is a High-Yield Investment Program?

A high-yield investment program (HYIP) is a fraudulent investment scheme that purports to deliver extraordinarily high returns on investment. High-yield investment schemes often advertise yields of more than 100% per year in order to lure in victims. In reality, these high-yield investment programs are Ponzi schemes, and the organizers aim to steal the money invested. In a Ponzi scheme, money from new investors is taken to pay returns to established investors. Money is not invested and no actual underlying returns are earned; new money is just used to pay people who entered the scam earlier than they did.

Though this brand of Ponzi scheme has existed since the early 20 th century, the proliferation of digital communications technology has made it much easier for con artists to operate such scams. Usually, an operator will create a website to lure in unsuspecting investors, promising very high returns but remaining vague about the underlying management of the investment fund, how the money is to be invested, or where the fund is located. These funds typically involve the alleged trading or issuance of “prime” bank financial instruments and may include references to prime European or prime world bank instruments. For this reason, this scam is also known as the “prime bank scam.”

Digital communications technology has made HYIPs and other scams easier.

How a High-Yield Investment Program (HYIP) Works

High-yield investment programs (HYIPs) are investment scams that promise unreasonably high returns and often just use new investors’ money to pay off older investors. Of course, this is not to be confused with a legitimate high-yield bond investment, which offers higher than investment-grade interest rates. HYIP operators will typically use social media, including Facebook, Twitter, or YouTube, to appeal to victims and create the illusion of social consensus surrounding the legitimacy of these programs.

The SEC advises that there are several warning signs that investors can use to help avoid being victimized by high-yield investment program scams. These include excessive guaranteed returns, fictitious financial instruments, extreme secrecy, claims that the investments are an exclusive opportunity, and inordinate complexity surrounding the investments. Perpetrators of high-yield investment programs use secrecy and a lack of transaction transparency to hide the fact that there are no legitimate underlying investments. The best weapon against getting sucked into a high-yield investment program is to ask a lot of questions and use common sense. If an investment’s return sounds too good to be true, it probably is.

High-Yield Investment Program (HYIP) Example

An example of an HYIP was Zeek Rewards, run by Paul Burks and shut down by the SEC in August 2020. Zeek Rewards offered investors the opportunity to share in the profits of a penny auction website, Zeekler, at returns of 1.5% a day. Investors were encouraged to let their returns compound and to increase their returns by recruiting new members. Investors were required to pay a monthly subscription fee of $10 to $99 and make an initial investment of up to $10,000. The SEC found that about 99% of the funds disbursed were paid out of the pockets of new investors and that Zeek Rewards was a $600 million Ponzi scheme. Burks was fined $4 million and sentenced to 14 years, 8 months in prison.

Investment scams

Protect yourself from investment scams

Page reading time: 6 minutes

Be suspicious of anyone that offers you easy money. Scammers are skilled at convincing you that the investment is real, the returns are high and the risks are low. But there’s always a catch.

How to spot an investment scam

There are three main types of investment scams:

  • The investment offer is completely fake.
  • The investment exists, but the money you give the scammer doesn’t go towards that investment.
  • The scammer says they represent a well-known investment company – but they’re lying.

In any case, the money you ‘invest’ goes straight into the scammer’s bank account and not towards any real investment.

How scammers get you to invest

To get you to give them your money, a scammer may tell you they’re offering:

  • high and quick returns or sometimes tax-free benefits
  • share, mortgage, real estate or virtual currency investments, ‘high return’ schemes, option trading or foreign currency trading
  • an opportunity with no risk or low risk, because you will:
    • be able to sell anytime
    • get a refund for non-performance
    • have insured or ‘guaranteed’ transactions
    • be able to swap one investment for another
  • inside information, the opportunity to invest before a public float or discounts for early bird investors

Warning signs of investment scams

The investment offer may be a scam if the person:

  • does not have an Australian financial services (AFS) licence or says they don’t need one
  • rings you repeatedly, keeps you on the phone, or emails you a lot
  • says you need to make a quick decision or you’ll miss out on the deal
  • offers you professional-looking prospectuses, brochures, share certificates or receipts, but their prospectus isn’t registered with ASIC

If you spot any of these signs, hang up the phone or delete the email. If you manage to record any of the scammer’s details, report them to the Australian Securities and Investments Commission (ASIC).

Tactics used by investment scammers

Some of the common tactics scammers use to trick you into investing:

COVID-19 phishing scams

A scammer may try to steal your information using ‘investment opportunities’ to make your money back from sharemarket losses. The scammer may pretend to be someone you know, like your fund manager or your financial adviser. They may contact you by email, phone or text, or on social media.

Signs of a phishing scam:

  • The email address doesn’t match the company name (also look for hotmail, gmail or outlook in the address).
  • There are spelling mistakes or the information doesn’t make sense.
  • You’re asked to update or confirm your personal details.
  • You’re asked for immediate payment.

Don’t click on any links. Delete the email or message straight away.

Directing you to a fake website

Scammers use sophisticated websites and issue fake online press releases that make false claims of outstanding corporate performance. They may provide some victims with logins to view fake investment balances and growing returns.

Stopping you pulling out of the deal

If you try to pull out of the deal, scammers may try to:

  • swap your current investment for another one
  • convince you that your investment will increase in value soon

Scammers may threaten you with prosecution or hefty fees to keep you from pulling out of the deal.

Using social media to approach you or your friends

Scammers may message you, advertise or send you a ‘friend’ request.

They may pose as someone you know or are connected to. If you ‘friend’ them they get access to your profile information. They can also send you offers to invest and make quick money.

Scammers may use your information to impersonate you. They may create a fake social media account to approach people in your friends list. See identity theft for more information.

Artificially inflating the share price

Scammers buy shares in a small company at a low price. They then send out false tips about the company having great prospects. As more people invest, the share price rises. The scammers sell their shares at the peak of the price rise, then the share price falls and the shareholders are left holding them at the reduced value.

Passing your call along the line

Investment scammers use a team of less experienced staff to make the initial call. The junior staff follow a tight script to check your interest. If you take the bait, they hand you over to a more senior person, called a ‘closer’. Closers are extremely skilful sales agents and their job is to make you feel compelled to close the deal and send your money.

Calling or emailing you persistently

Investment scammers may call or email you persistenly. They may keep you on a phone call for a long time, insisting you’ll miss out if you don’t take up their offer right away. They will not take no for an answer and will ask you about your worries to reassure you. As long as they can keep you talking or emailing, you haven’t really said no.

Operating from overseas

Many investment scammers operate from overseas or offer foreign investments, because their activities are illegal in Australia. Overseas scammers target Australians because ASIC does not have international jurisdiction to prosecute them.

How to check an investment is real

Simple research to make sure an investment is legitimate could save you from losing money to a scam.

1. Ask questions and request information

Check the legitimacy of the person offering the investment by asking them:

  • What is your name and what company do you represent?
  • Who owns your company?
  • Does your company have an AFS licence and what is the licence number?
  • What is your address?
  • Is your investing prospectus registered with ASIC?

If they try to avoid answering these questions, their investment offer is probably a scam. Hang up the phone, do not respond to the email. Stop dealing with the person or delete and block them if it’s through social media.

But, even if they can answer these questions, it doesn’t always mean the investment is legitimate.

2. Do your own research on the company

Don’t rely only on the information the person gives you to make your decision. Don’t be pressured to make a quick decision you could regret later.

Take these steps to do your own research — check:

  • ASIC’s OFFERlist database — See if the company has lodged a prospectus with ASIC.
  • Publicly listed phone directories — Check whether the address and contact details are correct.
  • ASIC Connect’s professional register search — Check the company has an AFS licence or Australian credit licence.
  • Our list of companies you should not deal with — Make sure the company name is not on our list.
  • International Organization of Securities Commission’s (IOSCO) investor alerts — Make sure the company is not named.
  • Our list of fake regulators and exchanges — Check if the investment offer mentions one.

If you invest through overseas companies and something goes wrong, you won’t be able to get help. A lower risk option is to invest overseas through licensed companies based in Australia.

Protect yourself from investment scams

Make sure you don’t fall victim to an investment scam:

  • Always get independent financial advice before you invest
  • Do your own checks on any investment opportunity to make sure it’s real.
  • Remember the common signs and tactics so you can spot an investment scam.
  • Don’t accept a message or friend request on social media from someone you don’t know.
  • Make sure your privacy settings are up to date on your social media accounts.
  • Be wary of random or unexpected contact, particularly if you have replied to something on a website or social media platform.

If you think you have been the victim of an investment scam, you should:

  • Report it to ASIC or your report it to your local police.
  • Stop sending money to the company.
  • Be wary of falling for a secondary scam or offers to recover your money.
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