POLICE have issued a warning after a 29% increase in "clone firm" investment scams cost Hampshire residents £16m.

People across the county lost an average of £31,941 last year after pouring money into what turned out to be fake investment firms.

Residents in their 70s are among those most likely to fall victim to the scam.

So-called "clone firms" are set up by fraudsters using the name, address and Firm Reference Number (FRN) of real companies authorised by the Financial Conduct Authority.

Criminal gangs snare victims in several ways, often taking out adverts on social media platforms and search engines.

People clicking on the adverts are taken to exact replicas of websites belonging to genuine investment firms.

Once victims have registered their interest they are contacted by the fraudsters, who often obtain the names of genuine employees and create seemingly legitimate company email addresses, but with subtle changes.

Victims end up transferring their hard-earned savings to the conmen, convinced they are sending them to a legitimate investment firm.

Often they discover the scam months later, when they fail to receive quarterly returns or investment reports.

Police fear the financial impact of coronavirus may be making people more likely to fall victim to clone scams.

Det Sgt Marcus Mills, of Hampshire Constabulary’s Economic Crime Unit, said: "We are aware that more people are spending time at home, and online, due to the ongoing global pandemic.

"This unfortunately leaves people vulnerable to acts of fraud.

"Hampshire, like many other areas, seemingly saw a spike in activity during the summer months last year and this has continued, albeit rates have slightly dropped in recent months.

"It’s important to remind residents of the age-old saying that if something is too good to be true, it likely is.

"Fraudsters use very sophisticated mechanisms such as cloning official investment websites or spoofing email addresses to make you feel as if the investment is genuine.

"They are often incredibly charming and reassuring in their approach, using lots of expert financial literacy."

Detective Chief Inspector Andy Richardson is head the Regional Cyber Crime, Digital Forensics and Economic Crime for the South East Regional Organised Crime Unit (SEROCU).

He said: “These scams can have can have catastrophic, wide-reaching consequences.

“Thousands of pounds have been lost due to clone investment fraud and the only way to be sure is to check every detail.

“Responsible businesses would not have any issue with you carrying out due diligence and we recommend you carry out substantial research to ensure your money is going where you want it to go."

Anyone with suspicions about a website can email report@phishing.gov.uk. Suspicious text messages should be forwarded to 7726.