Australia's securities regulator has taken down more than 330 fake investment websites this year that use images of prominent billionaires to trick people into bogus get-rich-quick schemes, marking a 25% jump from the same period last year.

The Australian Securities and Investments Commission (ASIC) says scammers are increasingly hijacking photos of well-known figures like mining magnates Andrew "Twiggy" Forrest and Gina Rinehart, along with packaging billionaire Anthony Pratt, to lend fake credibility to their fraudulent investment platforms.

Scammers Exploit Social Proof Psychology

These fake websites deliberately misuse trusted public figures to exploit what psychologists call "social proof" - the tendency for people to follow others they perceive as successful or authoritative. Many of the targeted celebrities have publicly denied any involvement with these schemes.

"These scam websites try to trick consumers into thinking they can make big returns and use unauthorised celebrity images to give credibility," said ASIC Commissioner Alan Kirkland. "Whenever you see a website, social media post or message offering an investment that claims to deliver outsized or guaranteed financial returns, always remember to stop, check and protect."

The regulator saw particularly heavy activity in July, when scammers apparently tried to capitalize on increased consumer interest in finances at the start of the new financial year.

A similar issue was recently highlighted in neighboring New Zealand, which reported a scheme involving fake accounts impersonating local celebrities on Facebook. These accounts directed users to trading groups on WhatsApp, which in most cases turned out to be scams.

AI Enables Rapid Scaling of Fraud

The rise of artificial intelligence has allowed scammers to expand their operations at unprecedented scale. ASIC has observed several troubling trends in recent months, including fake trading platforms, professionally designed cloned websites, fabricated news articles promoting fraudulent schemes, and "AI trading bot" products promising impossible returns.

Investment scams cost Australians $945 million in 2024, making them the leading cause of financial fraud losses according to the National Anti-Scam Centre.

ASIC has now extended its takedown capabilities beyond websites to include investment scam advertising on social media platforms, recognizing that many fraud schemes begin with targeted ads that lure victims to fake investment sites.

Related: Don’t Trust Fake Elon Musk Encouraging You to Invest, Warns Regulator

Regulator Boosts Enforcement Activity

The celebrity scam crackdown comes as ASIC undergoes a significant transformation under Chair Joe Longo, with new commissioners and leadership driving a more aggressive enforcement approach. The agency launched 50% more investigations over the past year and initiated nearly 20% more civil enforcement proceedings compared to the previous period.

"That transformation is key to ensuring ASIC can continue to serve the Australian community," Longo said. "The operating environment for our financial ecosystem is increasingly complicated and that requires a well-calibrated response from ASIC."

The regulator is currently removing an average of 130 malicious websites every week, with fake investment platforms, phishing sites and crypto scams making up the bulk of takedowns. Since launching the program two years ago, ASIC has shuttered more than 14,000 investment scam and phishing websites.

New Rules Target AI Trading Systems

ASIC is also moving to modernize its market integrity rules to keep pace with technological developments, including artificial intelligence in trading systems. The regulator estimates that algorithmic trading now comprises about 85% of all trading in Australian listed equities markets.

The proposed changes would extend principles-based rules to cover participants' development, testing and monitoring of trading algorithms, while requiring "kill switches" to immediately suspend problematic automated trading activity.

"During periods of heightened volatility , financial markets may be especially vulnerable to risks from unexpected activity by trading algorithms or AI," ASIC noted in its consultation document.

Super Switching Schemes Also Target Consumers

ASIC has separately warned consumers about aggressive superannuation switching schemes that often begin with social media ads for free super "health checks" or help finding lost retirement funds. These operations typically use high-pressure sales tactics and promises of unrealistic returns.

The regulator advises consumers to hang up if they feel pressured and remember that moving superannuation funds is a major financial decision that shouldn't be made hastily.

ASIC has also extended relief for hardship withdrawals from frozen managed investment schemes for another 18 months while it conducts further consultation on the rules.