Recovery scams target people who have already lost money to a scam or failed investment. Scammers may contact you claiming they can recover your funds, trace lost assets, or secure compensation on your behalf. Their goal is to gain your trust and convince you to pay upfront fees or share more personal information.
What is a recovery scam?
A recovery scam targets people who have already lost money to a scam or failed investment. Scammers know that people who have experienced financial loss will be looking for a way to recover their money.
The scammer claims they can recover your funds, trace lost assets, or secure compensation on your behalf. They may pretend to be a government agency, law firm, recovery specialist, or even someone connected to the original investment. Their goal is to create the impression that they are a legitimate organisation offering help.
To make their approach seem credible, recovery scammers often use information obtained through previous scams, including your contact details, investment history, or details of money you have lost. This can make their claims appear genuine and convincing.
Knowing the warning signs can help you avoid losing more money.
How to spot a recovery scam?
Red Flags
🚩You’ve lost money before
People who have previously lost money to a scam or investment are often targeted because scammers know they will be looking for a way to recover their losses.
🚩Unexpected contact
You receive an unsolicited call, email, message, or letter claiming that your money has been found or can be recovered. The person may claim to represent a government agency, law firm, or recovery service.
🚩Your funds have increased in value
You're told your lost funds have been located, are being held for you, or have increased in value. The claim is often difficult to verify independently.
🚩You need to pay first
The scammer says you must pay a fee, tax, legal or compliance costs before your money can be released.
🚩Pressure to act quickly
You're told to act urgently or risk losing the opportunity to recover your funds. Scammers use pressure to stop you from checking their claims.
🚩It is difficult to verify
The person contacting you is unwilling or unable to provide clear information about who they are, how they found your money, or how the recovery process works.
How to protect yourself
✅Be skeptical of unsolicited offers
Be cautious if someone contacts you unexpectedly claiming they can or have recovered money you've lost.
✅Be careful of who you trust online
Scammers often search social media, forums and online communities for people who have lost money. They may pretend to be another victim and claim they successfully recovered their funds through a company or service they recommend.
✅Verify independently
If someone claims to represent a regulator, government agency, or a company, contact the organisation directly using contact details you have independently found. Not what the person has provided you.
✅Never pay upfront fees
Be wary of requests for taxes, insurance, legal costs, or administration fees to release recovered funds.
✅Take your time
Scammers often create urgency. Take the time to check their claims independently before acting.
✅Watch for warnings
Check the FMA’s Warnings and Alerts list to see if the company, platform, or offer being promoted has been flagged.
If you think you’ve been scammed
Scams can happen to anyone. Acting quickly can help reduce further harm.
- Contact your bank or payment provider immediately to report the scam and request a transaction reversal.
- Contact IDCARE for support and guidance if personal details were shared (0800 121 068 or online at www.idcare.org)
- Report investment scams to the FMA.
- Report fraudulent accounts to platforms used by the scammer.
- Talk to someone you trust or contact Victim Support (0800 842 846).
Helping a Friend or Family Member
Approach the conversation gently. Victims often don’t realise what’s happening because scammers work hard to build trust and isolate them.
Try to:
- Show concern, not blame
- Review the warning signs together
- Reassure them it can happen to anyone
- Offer practical help with the steps above
Examples of recovery scam warnings we have published
Recovery scams targeting New Zealand investors | Financial Markets Authority
