The Australian Securities and Investments Commission has revealed an elaborate hoax that it played on gullible net users, convinced online investors to commit over $4 million to a bogus online company.
Through a site offering investments in Millennium Bug Insurance launched on the 1st of April, ASIC conned 233 investors into committing money to a non-existent company to demonstrate the potential dangers of investing online.
Since the site was established in April, it has attracted 10,200 people of which 233 of those committed themselves to investing between $10,000 and $50,000 to the company. A further 1212 people requested further information about investing.
According to ASIC Chair Alan Cameron the April Fools Day joke was designed to highlight the dangers of taking information on the Internet at face value.
"We chosetheInternetasthisyear's April Fools Day investment scam becausesomepeople,whomightnormallyquestionthevalidity of an investmentoffer, seem to think that offers on the Internet come with some authority," he said.
"Taking advice over the Internet is the same as taking advice from someone on a street corner. Handing over $50,000 on the Internet is the same as handing over $50,000 to someone on the street?"
People who committed to investing in the scam will be notified by email of the hoax and advised to be more careful about their investment habits in future.
The hoax comes at a time that ASIC is stepping up its investigations into online financial fraud. The organisation launched a new electronic enforcement unit last month to step up the fight against financial fraud on the Internet.
According to Mr Cameron, ASIC's moves are in line with the growth of the Internet as a tool for investors.
"While the Internet has been around for some time, regulators have moved up a gear to monitor the growing number of investment offers being made to the public," Cameron stated.
"People who make offers which aren't genuine, or which breach the Law, need to know they are not the only ones who have the technology - ASIC is watching them."
