A financial scam is an action carried out by an individual or a company that causes economic harm to another person through deception and with the intention of making a profit. There are many types of financial scams and fraudulent schemes, and in recent years they have multiplied due to the opportunities created by new technologies and social media.
Falling victim to a financial scam can lead to significant financial losses, making it essential to prevent them and learn how to identify them.
How can you recognize a financial scam? For example, if someone promises you:
• exceptionally high returns
• “infallible” investment methods
• unrealistic solutions to your financial problems
The forms of deception are endless, and most rely on promises of future returns far above what is realistic in the current economic context, in exchange for an upfront payment handed to a supposed expert or to an unauthorized entity. Always be cautious of any “guaranteed high-return” investment opportunity.
Contents
- Chiringuitos financieros: How they operate, risks, and verification methods
- Types of scams (and how to avoid them)
1) Identity theft
2) Funded trading accounts
3) Fake IT technician fraud
4) “Recovery room” activity
5) Crypto-asset fraud
6) Ponzi schemes
7) Phishing, smishing, and vishing
8) Pharming
9) Social media scams - Summary: Key recommendations to avoid financial fraud
- What to do if you have been a victim: urgent steps, reporting, recovery, and documentation
01. Chiringuitos financieros
The term chiringuitos financieros—used by the Spanish regulator CNMV to describe unauthorized investment firms—refers to entities that provide investment services without any regulatory approval.
These entities present themselves as legitimate investment providers, but their sole objective is to take money from victims. They use the same communication channels as regulated firms—phone calls, emails, websites, social media—yet their operating methods are entirely different.
Regulated investment firms are registered and supervised by financial authorities such as the CNMV, the Bank of Spain, and the Directorate-General for Insurance and Pension Funds. Chiringuitos financieros, on the other hand, operate outside the law. Their victims are not covered by any investor-protection schemes, such as investment guarantee funds or deposit guarantee systems, and therefore cannot be compensated.
Trusting a chiringuito financiero is a direct path to losing your money.
The best protection is the ability to identify them. Never rely on an unfamiliar company without first confirming that it is duly authorized to provide investment services. You can check this using the registries of the CNMV, the Bank of Spain, or the Directorate-General for Insurance and Pension Funds.
You may also request information directly from the CNMV by calling 900 535 015.
Always confirm authorization before entering into any investment agreement.
02. Types of scams (and how to avoid them)
Below are common types of financial scams, along with practical recommendations to help you avoid becoming a victim.
Scam 1: Identity theft of authorized entities
Some chiringuitos financieros use the identification details of legitimate companies registered with the CNMV to mislead investors. These “clone firms” reproduce logos, names, websites, and even domain names that differ only slightly from the real ones.
Before entering into any financial agreement, verify:
• the company’s legal name
• its commercial brand
• the domain and official website
• the registered office and postal address
• its registration number with the competent regulator
Always perform this verification through the official CNMV website. Reject any unsolicited offer until you have confirmed it comes from a properly registered entity.
Some entities appear in the CNMV registry with the label “clon” (clone), meaning they have no link to the legitimate entity they imitate. Never entrust these companies with your money.
Scam 2: Funded trading accounts linked to training programmes
Some companies offer access to a “funded trading account,” supposedly allowing users to trade using the firm’s capital rather than their own, in exchange for a share of the profits. To access such an account, the user must often pay for training courses and pass simulated trading tests.
In many cases, these programmes are fraudulent: victims lose the money paid and never receive the promised access.
These activities are not supervised by the CNMV. Exercise extreme caution.
Scam 3: Fake IT technician fraud
Some scammers use remote-access software to connect to a victim’s device and obtain login credentials, which they then use to access the victim’s bank or securities accounts.
Posing as IT technicians from investment platforms or well-known companies, they claim to have detected a technical problem and ask the victim to install remote-control software. They often suggest silencing the phone or not touching the device during the “repair.”
Their real objective is to steal funds, personal data, or card information.
Key recommendations:
• Never disclose your login credentials.
• Never grant remote access to your devices.
• Never log in to your bank or investment accounts while someone else is connected to your device.
Scam 4: “Recovery room” activity
“Recovery room” scams involve contacting individuals who have already been victims of chiringuitos financieros, offering to help recover lost funds or repurchase worthless assets. These operations are often run by the same scammers, or by companies that have purchased lists of victims.
If you are asked to pay upfront fees or taxes to recover your money, it is a clear sign of fraud.
The CNMV never contacts victims to recover funds and never authorizes third parties to use its name or logo for this purpose.
Scam 5: Crypto-asset fraud
Crypto-assets, including cryptocurrencies, are digital representations of value. There are numerous fake crypto-assets created solely to defraud investors.
Scammers aggressively promote them through social media, SMS, email campaigns, and online advertising. They promise extraordinary profits and pressure victims to act quickly.
Practical advice:
• Do not trust promises of exceptional short-term returns.
• Always check whether the company is authorized and not included on official warning lists.
• Never invest in something you do not fully understand.
• Legitimate intermediaries never pressure you into making immediate decisions.
Important:
Crypto-assets are unregulated, meaning they do not benefit from any investor-protection mechanisms in Spain or the European Union.
Scam 6: Ponzi schemes
A Ponzi scheme involves recruiting new investors with the promise of high returns. The money is not truly invested; instead, funds from new participants are used to pay earlier investors, creating the illusion of profitability.
Once fresh money stops coming in, the scheme collapses, and investors lose everything.
The best protection is to distrust unusually high returns and avoid making decisions solely based on recommendations from acquaintances.
Scam 7: Phishing, smishing, and vishing
These techniques aim to steal personal login credentials to access bank or investment accounts.
• Phishing: fraudulent emails imitating reputable institutions
• Smishing: fraudulent SMS messages
• Vishing: fraudulent phone calls impersonating trustworthy entities
To protect yourself:
• Do not respond to messages requesting personal information.
• Delete suspicious messages immediately.
• Access your bank by typing the URL directly into your browser.
• Use strong, unique passwords.
• If you suspect an attack, change your credentials and notify your bank immediately.
Key reminder:
Authorized financial institutions will never ask for your personal access codes.
Scam 8: Pharming
Pharming is a sophisticated cyberattack in which criminals infect your device with malware that redirects you from legitimate websites to fraudulent copies.
To protect yourself:
• Install reliable antivirus software
• Use a password manager
• Check that the website uses https and displays a valid security certificate
Scam 9: Social media scams
Many investors today look for financial information on social media. Scammers and chiringuitos financieros exploit this by creating fake profiles, impersonating legitimate entities, and spreading misleading or manipulative content.
These scams often involve market manipulation—spreading fake positive news to artificially inflate a stock price, or negative rumors to depress it and buy cheaply.
Precautions:
• Do not trust investment advice from unknown individuals.
• Verify the identity and credibility of anyone giving financial recommendations.
• Do not make decisions based on viral messages or rumors.
• Ensure that any financial intermediary is properly authorized.
03. Summary
Key recommendations to avoid financial scams:
• Always verify authorization using the CNMV, Bank of Spain, or DGSFP registries.
• Be wary of unsolicited offers or offers that seem too good to be true.
• Distrust promises of exceptionally high returns in short timeframes.
• Protect your personal and financial information: never share passwords.
• Be cautious with information found on social media.
• Do not invest in assets or products you do not understand.
• The CNMV does not recommend investments and never contacts investors to offer services.
04. What to do if you have been a victim of a scam
If you have transferred money to a questionable entity, you may not be able to recover it, but it is essential to act quickly.
Warning signs of fraud:
• Your contact person stops responding
• You receive vague or unclear information
• New excuses begin to appear
Under no circumstances should you send additional money.
If you suspect you have been a victim:
• Notify the CNMV
• File a report with the National Police, the Guardia Civil, or a court
• Keep all relevant documentation: contracts, emails, payment receipts
Important:
Keep absolutely all documentation related to the transaction — it will be essential for any legal proceedings.
Miguel Morillon
Lawyer
MORILLON AVOCATS
