'I feel terrible': Man who lost life savings to woman he met on Tinder warns Kiwis to do their research

Man with cellphone and computer
Lured by a match made on Tinder, 'Tom' lost $130,000 over five months in a foreign exchange trading scam. Photo credit: Getty.

After losing $130,000 in a romance-induced scam involving foreign exchange trading, a Kiwi man says he didn't research the company enough and is sharing his story to warn others.

The Financial Markets Authority (FMA) to which the scam was reported, says asking for increasing amounts of money and exerting pressure to make investment decisions are among the tactics scammers use.

Lured into offshore foreign exchange trading by a woman he met online, a young professional man referred to only as 'Tom' lost $130,000 over five months. 

"I feel terrible for having fallen for what looks to me now like an obvious scam...I realise that it's also my fault for not researching nearly enough before engaging with the scammers," Tom told the FMA.

He lost 12 years of savings and ended up with credit card debt.

"An attempt to create an alternative income has instead left me with a huge debt, and in a much worse place than before," Tom added.

The online 'romance' started when Tom matched with a woman called 'Zhu Xin' on Tinder.  After about a week, the pair took their conversations to WhatsApp. They had video calls where Tom could "see her face".  Zhu Xin sent him videos including clothing purchases and a cafe she said she owned, showing she had money.

Their conversations then moved to the foreign exchange market, where Tom was already trading. It was a mutual 'interest' - or so Tom thought.  Zhu Xin sent screenshots of trades she'd done, claiming she was a 'VIP client' of a trading company called Business Choice Partners Group. She also sent 'trade information', indicating it was exclusive to VIP members and she wasn't supposed to share.

Seeing the company used the foreign exchange trading platform MetaTrader where it was listed alongside legitimate traders, Tom set up an online demo account. He was referred to a woman called 'Wang Li', who Zhu Xin said was her adviser.  Gaining confidence, he decided to put money in.  

"I’d already done lots of research and knew how it worked, but not to the point of deep analysis…I saw it as a next step in investing," Tom explained.

After he was told his bank transfer of $1000 didn't go through, Tom made a transfer using Tether cryptocurrency and began trading in his own name. He was offered leverage of 1:100, where he was told for each $1 invested, he could place a 'trade' worth $100.  

As he could see his account, including the trades he'd made, the transactions appeared legitimate. The account also showed his initial deposit had grown. 

"All of it matched other brokers, there was no time delay, the tickers matched, and the data used was accurate," Tom explained.

Over the next four months, the FMA says the company changed its name twice. After a period of trading, Tom's account showed a big 'loss' due to foreign exchange 'volatility'. 

In an attempt to recover his 'losses', Tom sent more money. The women pressured him to become a 'VIP', requiring his account balance to be US$60,000 (NZ$85,187). He was given a deadline which if he didn't meet, he was told his account would be closed and money returned. 

After becoming a 'VIP member', Tom decided he wanted out and asked to withdraw his gains. At this point, both women avoided all contact, ignoring his messages and blocking his calls.

FMA director of regulation Liam Mason said as scammers want to be believed, they use a variety of tricks and tools to gain trust. And where romance is involved and money is sent overseas, people can be particularly vulnerable to losses. 

"Before investing money offshore and in an entity that you only know through its online presence, it's important to understand that [it] limits your recourse if something goes wrong," Mason said.

Requests for transfers in cryptocurrency should raise alarm bells, especially as the scammers asked for a bank transfer first. 

"That's a point where it's worth asking 'How is this money actually moving and where will I see it?'," Mason added.

But perhaps the biggest red flag is being asked for increasing amounts of money.  Often, scammers exert time pressure. In Tom's case, he was pressured to become a VIP member or have his account closed.

"The ability to create pressure and urgency around the decision to invest is a really big sign to look out for in investment," Mason added.

Over 2020 and 2021, dating apps were mentioned in six complaints made to the FMA. Of those, four were connected to people on Tinder.  Over 2019 and 2020, Netsafe data shows a 39 percent increase in reports of romance scams causing financial loss, with an average loss of $18,667.

Latest scam warnings can be found on the FMA website. More information about romance scams is available through Netsafe.