A New Year Means A New Resolution: Fraud Prevention – 12 Top Investor Threats

A New Year Means A New Resolution: Fraud Prevention – 12 Top Investor Threats Identified By North American Securities Administrators Association

WA DFI reminds investors to learn how to identify, prevent and report investment fraud

Olympia – The Washington State Department of Financial Institutions (DFI) and the North American Securities Administrators Association (NASAA) are warning investors that bad actors are using a new generation of sophisticated schemes in this New Year. Drawing on data from NASAA’s 2025 Enforcement Report and annual survey of top investor threats, DFI and NASAA have identified top investors frauds and threats to watch out for in 2026.

According to NASAA’s 2025 Enforcement Report, state securities regulators conducted more than 8,800 active investigations in 2024, leading to more than $259 million in monetary fines and restitution. The data reveals that while scammers are using new technologies like Artificial Intelligence (AI) to dress up their schemes, the goal remains the same: separating victims from their hard-earned money.

“The rapid growth of technology and the rise of artificial intelligence gives scam artists new tools to steal your money,” DFI Director Charlie Clark said. “Fraudsters are pitching new investments that often have nothing to do with latest tech developments and instead play on fear of missing out.”

DFI urges investors to review the following list of threats and add to their New Year Resolutions to make sure you don’t start the New Year with what could be devastating financial losses.

1. Affinity or "Pig Butchering" Scheme A major focus of 2025 enforcement, this long-con combines romance and finance. Scammers befriend victims online, build trust over time, and convince them to invest heavily in fake platforms before disappearing with the funds.

2. Deepfake Impersonations Regulators warn that 22.2% of bad actors are now using AI to generate deepfake videos and cloned voices of celebrities or trusted friends to solicit money or endorse fake products.

3. Phantom AI Trading Bots Criminals sell AI-powered "trading bots" that promise guaranteed returns. These are often black-box scams where the algorithm and the profits do not exist.

4. Digital Asset & Crypto Fraud Consistently a top threat, digital asset scams accounted for hundreds of investigations in 2024. These often involve unregistered securities, vague promises of high returns, and fictitious trading apps and websites in the crypto space.

5. Fake AI Equity Pitches Scammers are selling stock in companies that purportedly develop breakthrough AI models. These are often "pump and dump" schemes or sales of equity in companies that are entirely fictitious.

6. Social Media Lures Regulators report that nearly 32% of investigations opened in 2024 involved scams originating on platforms like Facebook, Instagram, and X. If an investment opportunity appears in your newsfeed, approach with extreme caution.

7. Short-Form Video Hype Scammers are increasingly using TikTok and Instagram Reels to post slick, professional-looking videos that tout "get rich quick" schemes to younger demographics.

8. Text & WhatsApp Traps Unsolicited messages on Telegram and WhatsApp are a growing threat. These often start as a "wrong number" text that pivots into a conversation about an exclusive investment opportunity.

9. Targeting Older Investors In 2024, regulators investigated more than 1,600 cases involving senior victims. Older investors are specifically targeted with traditional scams involving promissory notes and equities, as well as newer digital frauds.

10. Account Takeovers Using AI and phishing, fraudsters are seizing control of existing financial or social media accounts to steal funds or solicit money from the victim’s contact list under the guise of an emergency.

11. Website & App Spoofing Using AI to generate professional graphics, scammers create clone websites that look identical to legitimate financial institutions to trick users into handing over login credentials and funds.

12. Unregistered Solicitors Despite professional-looking websites and pitches, many sellers are not licensed. In 2024, regulators opened 944 investigations involving unregistered individuals.

Learn more about investment fraud happening in Washington State by visiting DFI’s Investment Scam Tracker. Find information about how to identify, prevent, and report fraud at www.dfi.wa.gov/10B.  

###

About DFI ▪ www.dfi.wa.gov ▪ 360-902-8700 ▪ 877-RINGDFI (746-4334)The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department also works to improve financial education throughout Washington through its outreach programs and online clearinghouse www.dfi.wa.gov/financial-education. In addition to posting information about licensees and administrative actions, DFI uses the Web and social media to provide financial education information: https://www.facebook.com/wadfi ■ www.instagram.com/wastatedfi/ ■ https://x.com/dficonsumers ■ https://dfi.wa.gov/financial-education/blog ■ https://www.youtube.com/user/WADFI ■ www.homeownership.wa.gov ■ www.linkedin.com/company/state-of-washington-department-of-financial-institutions/ ■ https://bsky.app/profile/wastatedfi.bsky.social

About the Division of Securities ▪ www.dfi.wa.gov/securities ▪ 360-902-8760 ▪ 877-746-4334The Division of Securities regulates securities investments, franchises, business opportunities, and off-exchange commodities sold in Washington and the firms and individuals that sell these products or provide investment advice. The Division handles complaints, conducts investigations, and takes appropriate enforcement actions to protect investors and combat fraud.