Promised high returns from an unauthorised investment firm? UK law offers multiple recovery routes — from FSCS compensation to fraud prosecution. Here's your action plan.
First, check if the firm is FCA-regulated at register.fca.org.uk — unauthorised firms are scams. If they're not authorised, report to the FCA immediately. Then claim FSCS compensation (up to £85,000 per person if the firm has failed). Report the fraud to Action Fraud. Finally, request reimbursement from your bank under fraud rules. Recovery success depends on whether the firm is regulated and how quickly you act.
Investment scams typically involve a fraudulent firm or individual promising unusually high returns (10-50% annual returns, for example) with minimal risk. They build trust through websites, social media, or referrals, then pressure you to invest a large sum. Once the money is received, contact is lost or "losses" are claimed, and you're asked to invest more to "recover" your funds.
The key danger sign: if the firm isn't on the FCA register, it's not authorised to provide investment services in the UK. This makes your investment completely unprotected by law.
Victims often face a choice: admit the loss and stop investing (cutting losses), or "double down" by investing more in hopes of recovery (which is exactly what scammers want). The psychological pressure is intense because the victim believes the money is "almost" recoverable.
Before taking any action, verify whether the firm claims to be FCA-regulated:
Many scammers use fake FCA registration numbers or websites that look like the real FCA register. Always verify at the official register, never click links provided by the investment firm.
Route 1: FSCS Compensation (Fastest) — If the firm claimed to be FCA-regulated and has now failed or been shut down by the FCA, you may be entitled to FSCS (Financial Services Compensation Scheme) compensation up to £85,000. This is a government-backed scheme. Check your eligibility at fscs.org.uk.
Route 2: Bank Reimbursement — If you sent the money via bank transfer after being deceived, you can claim reimbursement under fraud rules. Banks are increasingly obligated to investigate and reimburse investment fraud victims.
Route 3: Civil Recovery / Legal Action — If the firm has assets, you can sue them for fraud. This is slow and expensive, but may succeed if the firm has funds.
Route 4: Criminal Investigation — Report to Action Fraud and the FCA. If the firm is prosecuted and convicted, restitution orders can be made in your favour (though enforcement is weak).
Step 1: Verify Authorisation Status — Search register.fca.org.uk. If the firm isn't regulated, proceed immediately to Step 2. If it is regulated, contact the FCA's Consumer Helpdesk to report suspicious activity.
Step 2: Report to FCA — Even if the firm claims to be regulated, report it if you suspect fraud. Visit fca.org.uk/scams or call 0800 111 6768. Provide all documentation and communications.
Step 3: Report to Action Fraud — File a report at reportfraud.action.org.uk. Get your crime reference — you'll need this for FSCS claims.
Step 4: Contact Your Bank — Request reimbursement for the transfer under fraud rules (Fraud Act 2006, Payment Services Regulations 2017). Provide your Action Fraud reference and all evidence of deception.
Step 5: Check FSCS Eligibility — If the firm was FCA-regulated and is now unable to pay, claim at fscs.org.uk. You have up to 6 years to make a claim, but act promptly to preserve evidence.
If the firm was authorised and made deliberate false claims, you may claim for fraud. If the firm has failed (been shut down by the FCA), FSCS may compensate you up to £85,000. If the firm is still operating but making poor investment decisions, recovery is harder — losses are not automatically covered.
FSCS claims must be made within 6 years of the loss. However, you should claim as soon as you suspect fraud — time strengthens your evidence. For bank reimbursement claims, report within 13 months of the fraud.
Collect: screenshots of the website or app, copies of all communications (emails, messages), the firm's contact details and alleged FCA registration number, proof that the firm wasn't authorised (search FCA register), evidence of the false claims made, and bank statements showing the transfers. The key is showing the firm made false claims about authorisation or investment returns.
Yes. The fact that you authorised the transfer doesn't stop you claiming fraud reimbursement. The key is whether you were deceived into making the transfer. If the firm lied about its authorisation or investment returns, you were defrauded — voluntary authorisation is irrelevant.
This is a strong indicator of fraud. Legitimate investment firms receive money into company bank accounts, not personal accounts. This fact supports your fraud claim and makes recovery more likely — personal accounts can be more easily traced and frozen by banks.
Report to the FCA and Action Fraud today. Use FightingBack's investment scam templates to compile your evidence and claim FSCS compensation.
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