Victims fleeced twice in investment scam

By the Editorial Team · Monday, October 5, 2026

Criminals are increasingly targeting Australians who lost money to investment scams by posing as helpers who demand upfront fees to recover funds but then vanish without returning any money. This rising threat, known as recovery scams, has led to reported losses of around $2.1 million since early last year, prompting calls for greater public awareness and reporting of suspicious recovery offers.

A growing fraud targeting Australians who have already fallen victim to investment scams is emerging as one of the country’s most significant rip-offs. Known as recovery scams, these schemes involve criminals, often based overseas, contacting individuals who have lost money in previous scams and offering to retrieve their funds for a fee. After victims pay upfront fees that can run into thousands of dollars, the perpetrators disappear without returning any money.

The scam typically begins with the fraudsters using personal information from the initial theft to reach out to the victims. They often claim that the lost funds are held in complex accounts such as bitcoin wallets and require additional payments for legal or administrative fees to release the money. Private investigator Ken Gamble, who specialises in scam investigations, noted that many of the syndicates operate from Europe, particularly Ukraine, and frequently use phone calls as the main method of contact.

“There are cases where victims have paid more in the recovery scam than what they lost originally,” Gamble said, indicating that this type of fraud represents a rising threat in Australia. Data from Scamwatch show that since the start of last year, Australians have lost approximately $2.1 million to recovery scams, with 3,776 reports logged. Of these, about 1,844 were made via phone, 990 through email, and 521 by text message. Experts warn that these figures likely underestimate the true scale of losses, as many victims do not report either the initial scam or the subsequent recovery scam.

Chris Sheehan, an investigations executive with the National Australia Bank group and former Australian Federal Police investigator, described recovery scams as particularly harsh because they prey on individuals who are already vulnerable. “People who have lost money to investment or romance scams are often coping with financial loss, embarrassment, and emotional distress,” he said. “Then a criminal approaches them, pretending to help recover that money, but it’s often the same scammer or another using the original information to exploit the victim again.”

Sheehan stressed that these scammers frequently pose as professionals such as lawyers, investigators, or official agents and ask for upfront fees or personal details. He urged victims not to feel ashamed about coming forward, emphasizing that underreporting only benefits the criminals. “Being scammed once is devastating. Being targeted a second time when you’re trying to recover from that experience is especially heartless,” Sheehan said, calling for heightened awareness around unsolicited offers to recover lost funds. He advised the public to be wary of unexpected contacts requesting money in exchange for retrieving financial losses.

Authorities continue to emphasize vigilance and caution when dealing with unsolicited recovery offers, highlighting the importance of verifying the legitimacy of any claims and reporting suspicious activity promptly to help combat this growing form of fraud.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.