The most critical threats to retail investors in 2025 include digital assets, social media apps and emotional plea marketing tactics, the North American Securities Administrators Association (NASAA) said.
In a report released on Thursday, NASAA outlined the top threats to retail investors this year. Developed by surveying state and provincial securities regulators in the U.S. and Canada, the association found that most of its members are spending time investigating scams targeting investors through platforms like Facebook and X, and through text- and voice-based communication platforms like Telegram and WhatsApp. Scammers are also using video platform, like YouTube and TikTok to reach victims, the report said.
The association said scammers are also using artificial intelligence (AI) to create graphics, videos and content that create a sense of legitimacy, and to create deepfake images, videos and voices of celebrities and people known to victims. Using AI, bad actors are creating and selling AI-powered trading bots, selling equity in companies, developing an AI model, or perpetrating account takeover scams, the association said.
“The rapid growth of technology and the rise of artificial intelligence gives scam artists new tools to steal your money,” said Leslie Van Buskirk, NASAA President and Wisconsin Securities Administrator. “AI investing is the latest technology to make waves in the investing landscape and fraudsters are pitching new investments that often have nothing to do with the latest tech developments and instead play on fear of missing out or get rich quick schemes along with other heightened emotions. In many cases, they are downplaying the need for due diligence and are pressuring investors to quickly part with their money.”
Many of the schemes are affinity frauds that may be tied to emotion. Through relationship or romance scams, the fraudsters contact victims and develop relationships with them then solicit larger and larger investments. Once the victim’s bank accounts have been drained, the scammers disappear.
Despite slick images and marketing material, the investments are often not register or licensed by regulators to deal in securities. Regulators urge everyone to do their research to ensure schemes are legitimate.
“State registration laws are critical to the protection of investors,” said NASAA Enforcement Section Committee Co-Chair Amanda Senn. “Registered parties must typically demonstrate their qualifications, satisfy background checks, and even open their books and records to periodic state inspection. Investors should always look into the registration status of parties before purchasing investments especially those promoted over the internet or in social media.”