Australia'ssecurities regulator has taken down more than 330 fake investment websites thisyear that use images of prominent billionaires to trick people into bogusget-rich-quick schemes, marking a 25% jump from the same period last year.TheAustralian Securities and Investments Commission (ASIC) says scammers areincreasingly hijacking photos of well-known figures like mining magnates Andrew"Twiggy" Forrest and Gina Rinehart, along with packaging billionaireAnthony Pratt, to lend fake credibility to their fraudulent investment platforms.Scammers Exploit SocialProof PsychologyThese fakewebsites deliberately misuse trusted public figures to exploit whatpsychologists call "social proof" - the tendency for people to followothers they perceive as successful or authoritative. Many of the targetedcelebrities have publicly denied any involvement with these schemes."Thesescam websites try to trick consumers into thinking they can make big returnsand use unauthorised celebrity images to give credibility," said ASICCommissioner Alan Kirkland. "Whenever you see a website, social media postor message offering an investment that claims to deliver outsized or guaranteedfinancial returns, always remember to stop, check and protect."Theregulator saw particularly heavy activity in July, when scammers apparentlytried to capitalize on increased consumer interest in finances at the start ofthe new financial year.A similar issue was recently highlighted in neighboring New Zealand, which reported a scheme involving fake accounts impersonating local celebrities on Facebook. These accounts directed users to trading groups on WhatsApp, which in most cases turned out to be scams.AI Enables Rapid Scalingof FraudThe rise ofartificial intelligence has allowed scammers to expand their operations atunprecedented scale. ASIC has observed several troubling trends in recentmonths, including fake trading platforms, professionally designed clonedwebsites, fabricated news articles promoting fraudulent schemes, and "AItrading bot" products promising impossible returns.Investmentscams cost Australians $945 million in 2024, making them the leading cause offinancial fraud losses according to the National Anti-Scam Centre.ASIC hasnow extended its takedown capabilities beyond websites to include investmentscam advertising on social media platforms, recognizing that many fraud schemesbegin with targeted ads that lure victims to fake investment sites.Related: Don’t Trust Fake Elon Musk Encouraging You to Invest, Warns RegulatorRegulator BoostsEnforcement ActivityThecelebrity scam crackdown comes as ASIC undergoes a significant transformationunder Chair Joe Longo, with new commissioners and leadership driving a moreaggressive enforcement approach. The agency launched 50% more investigationsover the past year and initiated nearly 20% more civil enforcement proceedingscompared to the previous period."Thattransformation is key to ensuring ASIC can continue to serve the Australiancommunity," Longo said. "The operating environment for our financialecosystem is increasingly complicated and that requires a well-calibratedresponse from ASIC."Theregulator is currently removing an average of 130 malicious websites everyweek, with fake investment platforms, phishing sites and crypto scams making upthe bulk of takedowns. Since launching the program two years ago, ASIC hasshuttered more than 14,000 investment scam and phishing websites.New Rules Target AITrading SystemsASIC isalso moving to modernize its market integrity rules to keep pace withtechnological developments, including artificial intelligence in tradingsystems. The regulator estimates that algorithmic trading now comprises about85% of all trading in Australian listed equities markets.Theproposed changes would extend principles-based rules to cover participants'development, testing and monitoring of trading algorithms, while requiring"kill switches" to immediately suspend problematic automated tradingactivity."Duringperiods of heightened volatility, financial markets may be especiallyvulnerable to risks from unexpected activity by trading algorithms or AI,"ASIC noted in its consultation document.Super Switching SchemesAlso Target ConsumersASIC hasseparately warned consumers about aggressive superannuation switching schemesthat often begin with social media ads for free super "health checks"or help finding lost retirement funds. These operations typically usehigh-pressure sales tactics and promises of unrealistic returns.Theregulator advises consumers to hang up if they feel pressured and remember thatmoving superannuation funds is a major financial decision that shouldn't bemade hastily.ASIC hasalso extended relief for hardship withdrawals from frozen managed investmentschemes for another 18 months while it conducts further consultation on therules.This article was written by Damian Chmiel at www.financemagnates.com.