In a recent incident, a 58-year-old resident of Kolkata lost Rs 20 lakh to an investment scam on WhatsApp. Initially enticed by a Facebook advertisement offering a complimentary online stock trading course, the victim was subsequently added to a WhatsApp group by the organisers. Following a period of establishing trust, he was directed to a specific trading platform named Zoksa. Under pressure, he invested funds on this platform, only to discover it was fraudulent.
In another similar incident, the Cyber Cell of Delhi Police initiated a probe in an online investment scam after a 34-year-old woman claimed to have lost Rs 25 lakh. The victim claimed that she was looking for an opportunity to invest and an investment agent redirected her to trade on a third-party app. Initially, the investments appeared promising and yielded daily returns. However, once a substantial profit was amassed, the fraudsters abruptly froze her funds.
“There were layered levels of returns on the app, higher the amount, higher the profits. I was then further encouraged to invest in higher amounts, with assurances that the investing app was legally registered with SEBI and in collaboration with two other companies,” said the complainant.
The Stock Exchange Board of India (SEBI) has warned retail investors about such scams. In a letter to investors, SEBI said that fraudsters claiming to be registered with SEBI entice people with promise of guaranteed high returns. Investors, believing they are dealing with legitimate registered intermediaries, download the app and invest through it. However, the reality is that their investments never actually occur on the Stock Exchanges, instead, these transactions remain as paper trades within the app.
Here’s the ‘warning letter’ SEBI has sent to retail investors:
Dear Investor,
SEBI has been receiving complaints from investors/intermediaries about fraudulent trading activities in the name of prominent SEBI registered financial institutions.
Generally, impersonators carry out their activities via social media platforms and messaging apps, such as Facebook pages and WhatsApp groups. They make enticing promises of guaranteed high returns. Investors, believing they are dealing with legitimate registered intermediaries, download the app and invest through it. However, the reality is that their investments never actually occur on the Stock Exchanges. Instead, these transactions remain as paper trades within the app. When investors try to withdraw substantial amounts, the app suddenly becomes non-functional.
Investors are advised to stay away from fraudulent trading schemes/Apps promising unrealistic returns through block deals and IPO allotments. You may refer the following link of BSE website to verify the details of registered trading members of BSE, where you can find their official website links and details about the Apps.
