When an advert that appeared to feature star fund manager Anthony Bolton appeared on Abbie’s Instagram feed, it immediately piqued her interest.
The ad promised stock tips and information from what seemed to be a credible source. It contained a video in which the former Fidelity International fund manager appears to tell viewers: ‘I set up a WhatsApp investment group, every day I will share three stocks and the latest investment news… my goal is to help more investors.’
Abbie, 28, from London, ignored it at first. ‘But after a few days of being bombarded with the same ad, I decided to click on it,’ she says.
She had recently received a six-figure inheritance from her grandfather and was looking for somewhere to invest it.
After clicking on the advert, there was a link to join a WhatsApp group. Once in the group, she found a handful of members who appeared to be potential investors like herself, alongside experts sharing stock tips. Members were told they could use their own investment platform to buy the recommended stocks and there would be no fee for the advice.
The first stock the experts were talking about was Pheton Holdings (PTHL). This is a real company based in China, which was founded in 1998. It develops healthcare solutions for brachytherapy – a type of radiotherapy – and was listed on the US Nasdaq stock exchange in 2022.
Abbie was unconvinced by its potential. But the WhatsApp experts kept telling the group that Pheton was on the verge of being acquired by pharmaceutical giant Gilead Sciences, which could see its share price soar.
All the while, Pheton’s share price continued to rise, until after three weeks it had tripled in value to reach $18. Abbie was told it would keep rising to $45.
‘I thought, there’s literally proof in front of my eyes that it is going up, so am I missing out on something?’ she says.
She gave in to the pressure and bought shares using trading platform Robinhood.
The experts in the WhatsApp group also looked legitimate.
Their names and headshots matched those of employees of genuine US firm Denver Wealth Management.
There were also ‘broker assistants’ in the WhatsApp group who appeared to be women with professional-looking photographs, with names such as Melissa, Gwen, Olivia and Belle.
At first Abbie invested around £7,500, but continued to buy more shares as Pheton kept rising.
‘I kept adding more money into it because the ‘experts’ in the group were so convincing and partly because of the stupidity that comes when you see that you can make a lot of money really quickly,’ she says.
‘It gets in your head, and you think: I can pay off my partner’s student debt and I can pay for our wedding. You make plans in your head.
‘I’m a very rational person, and I think I lost that.’
Deceit: Sophisticated new technology allows scammers to generate fake video and audio of a real person speaking, such as the one of Anthony Bolton (above)
Over three weeks, Abbie invested £45,000. Then, suddenly, once the shares ticked over $30 each, their value plunged. In just a matter of minutes they dropped to $1.65 and the value of the company crashed from over $440million to just $23million.
Shareholders around the world lost money in the blink of an eye.
But at the same time a group of anonymous scammers – likely members of organised criminal gangs – became very rich.
That is because the advert that Abbie saw on Instagram was not genuine at all. Scammers had used so-called AI deepfake technology to create a video of Anthony Bolton speaking, when in fact he had nothing to do with the advert at all and had never spoken those words in his life.
I’m embarrassed at how stupid I was – I should have recognised the signs, and I should have known better
The sophisticated new technology allows scammers to generate fake video and audio of a real person speaking to make them appear to say things they haven’t said.
The WhatsApp group was run by scammers, who tricked unsuspecting victims to invest in companies to drive up their share price. They were using the names and profile pictures of genuine people to give themselves an air of legitimacy – without their knowledge or permission.
Known as a ‘pump and dump’ scam, fraudsters artificially inflated the value of Pheton Holdings by investing in it themselves, promoting it to unsuspecting investors and sharing false information about it.
Once the share price soars, the scammers sell their own shares for a significant profit, leaving those still holding shares nursing heavy losses.
Six months ago, average daily trading volumes for Pheton averaged in the tens of thousands. In the weeks leading up to the ‘dump’ they rocketed into the millions.
Abbie’s partner also invested £3,000 in the company, and she had told her parents to do so too, but fortunately they chose not to.
‘I have a deep feeling of shame,’ says Abbie. ‘People who trusted me, listened to me and thought that I knew what I was doing, took or nearly took my advice,’ says Abbie.
‘I’m embarrassed at how stupid I was – I should have recognised the signs, and I should have known better.
‘I hope I can put it behind me, but it will take months, if not years.’
The Mail on Sunday has identified at least 81 victims of the scam worldwide, but the actual number of victims is likely to reach into the thousands.
One is a professional investment analyst who lost over £13,000.
The online scammers were so convincing that they managed to fool him despite his expertise.
Fidelity International – and other investment giants – put out warnings about it.
When logging on to Fidelity’s investments and pensions platform recently, it had a red alert stating: ‘Fraudsters are increasingly using deepfake technology to carry out sophisticated scams.
‘Some of the world’s most high- profile investors, including former Fidelity fund manager Anthony Bolton, have been targeted.’
Another victim, Ahmed, 26, who lives in London, also bought PTHL shares after the stock was recommended in a WhatsApp group he had joined, and it rose by 10 per cent in just days.
He says: ‘I invested in PTHL using my investing platform Trading 212, and after a few days I noticed that it started increasing rapidly as they had promised, I decided to put in everything I could, so I also sold my other stocks.’
In total, Ahmed bought £32,000 worth of shares in the firm – and lost £28,000 when the value of the shares plunged.
‘I put in all the savings I had,’ he says. ‘It took years of hard work to save that money. I was so frustrated and shocked. I was kind of depressed – I had no idea what to do and I also felt very lonely.’
Ahmed contacted others in the WhatsApp investment group, but only one person replied.
‘All the other people – who were sharing their screenshots of their own transactions of very high numbers – I think they were all part of the scam,’ he says.
Many of those targeted appear to be those working in the financial sector, and who you might think are unlikely to fall victim to an investment scam.
James, a 39-year-old working in financial markets for a UK bank was stung too, losing £13,000 in the investment scam.
For James, the financial implications were small, but the scam took a mental toll.
He said: ‘From a from a monetary perspective, I’ll recover that loss within a couple of months, not like other victims who have lost their life savings… but it is the embarrassment.
‘I do this stuff day in, day out. I make money for the banks that I work for, and I feel embarrassed that I didn’t see through it.’
Hargreaves Lansdown co-founder Peter Hargreaves is another investing expert who has had his identity cloned without his knowledge or permission.
Crash: Shares in Pheton Holdings collapsed in July
Sarah Lennette, financial crime specialist at Starling Bank, says: ‘Ever-evolving technology has transformed scams and made it a lot easier for criminals to either pretend to be celebrities or use their image or voice.
‘Scammers need as little as three seconds of audio to clone voices, and celebrities often have hours of audio on the internet from TV or social media.’
Pheton denies any knowledge of the scam. A spokesman for the firm says: ‘Pheton’s management team unequivocally and categorically denies any involvement in, or knowledge of, any form of stock price manipulation.
‘Pheton plans to engage with its market makers, Nasdaq, and relevant regulatory bodies for the purpose of holding responsible parties to the scheme accountable.’
Robinhood declined to comment. A spokesman for Trading 212 said: ‘On July 10, our monitoring systems detected heightened risk in the stock. That same day we placed the instrument into close-only mode – blocking all new purchases while allowing clients to sell existing holdings.
‘Trading 212 will continue to act to prevent customer harm, and we remain committed to transparency and investor protection.’
Victims, meanwhile, are gathering to pursue class action against Meta, which owns Instagram, for allowing these adverts to appear on its platform, while others are considering legal action against their trading platforms for failing to protect them.
A spokesman for Meta says: ‘Online scams are growing in scale and complexity, driven by ruthless cross-border criminal networks that use sophisticated schemes to target people across the internet.
‘We don’t want this type of content on our platforms, which is why we’re continuing to invest in technology to aggressively enforce against scams, provide people with on-platform warnings and tools to protect themselves, and partner with banks, governments and law enforcement to stop these criminals.’
- Names of victims have been changed
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