The Australian Securities and Investments Commission (ASIC) has issued an urgent warning about a surge in sophisticated investment scams that use messaging apps like WhatsApp to lure victims onto fraudulent crypto trading platforms. The alert, published on May 24, 2026, highlights how scammers impersonate “star traders” in group chats, display fabricated profits and fake order books, and then block withdrawals by demanding invented fees — fees that also go directly to the criminals.
ASIC’s warning is particularly focused on young Australians. Survey data cited by the regulator shows that 23% of people aged 18 to 28 already own cryptocurrency, while 41% have been directly pitched crypto investments online. Combined with the fact that 72% of Gen Z have seen crypto ads on social media, this makes them extraordinarily reachable through the very channels scammers exploit.
The scam pipeline typically begins when fraudsters join or create “share trading” or “stock tips” groups, building trust before steering members to sham trading venues. Once victims deposit funds, the sites display realistic but entirely fake balances and profit figures. When a user tries to withdraw, they are told they must pay additional “release” fees. Those fees, ASIC stresses, are simply stolen as well — and no assets are ever returned.
Adding to the danger is a secondary wave of fraud: so-called fund recovery services that contact previous victims and offer to retrieve lost money for an upfront charge. European regulators have labeled this tactic “recovery room” fraud, and ASIC warns that such offers are nearly always scams.
The regulator advises investors to STOP before acting on unsolicited investment advice, CHECK whether a firm is licensed and appears on AUSTRAC’s Virtual Asset Service Provider register, and PROTECT themselves by contacting their bank immediately if funds have already been sent. The warning comes amid a broader crackdown: the Australian Federal Police recently reported that Australians lost more than $122 million to crypto investment scams in the preceding year, with people under 50 accounting for 60% of cases. Since July 2023, ASIC has also coordinated the takedown of over 7,300 phishing and scam sites, including 615 crypto investment scams and 5,530 fake investment platforms.
