Scammers are targeting horse racing enthusiasts, police have warned.
Action Fraud has received 20 complaints of investment fraud relating to horse racing since June with a total loss of £11,350.
The suspects claim to use software for placing horse racing bets on the victim’s behalf.
However, once payment has been made to the fraudsters, often methods to contact them are closed down and the victim does not hear from the fraudsters again.
Action Fraud has also noticed the re-emergence of other investment frauds where an individual is encouraged to invest in ownership of a race horse.
People are contacted about these non-existent opportunities primarily by post. However, after the fraudsters have received payments, the individual finds they are no longer able to get in contact with the company.
Andy Fyfe, detective chief inspector from the City of London Police, said: “With such large amounts of money involved, investment fraud in the horse racing community can leave people without a horse and having experienced a significant financial loss.
“We are urging people to thoroughly check the details of organisations they are dealing with and consider seeking independent advice before going ahead with an investment.”
Investment into a racing horse as part of a syndicate may fall within a collective investment scheme and therefore may be subject to FCA regulation.
Therefore, consumers are advised to consult the FCA guidelines before investing.
However, betting syndicates do not require a licence from the Gambling Commission or British Horseracing Authority.
Police also urge consumers to consider seeking independent legal and financial advice before making an investment.
Sam Instone, chief executive officer at London-based AES International, said: “ If you’re cold contacted about any investment opportunity or an investment sounds too good to be true, steer clear. It’s potentially a scam or an unregulated gamble.
"If you want to branch out into alternative investments, ensure you choose those that are regulated – racehorse ownership isn’t a regulated investment for example, meaning if you lose money, there’s no comeback. A decent financial adviser is not going to suggest you speculate with an unregulated investment.
“Finally, it isn’t necessary to choose complex alternative investments to try and beat the market. If you’re patient enough, market returns are actually remarkably generous.”
If you believe you have fallen victim to fraud report it to Action Fraud by calling 0300 123 2040, or visiting www.actionfraud.police.uk