You must be lucky if you haven’t been approached by fake stock market traders on a direct call or through social media platforms such as Telegram, WhatsApp, Instagram and Facebook. Lately, anonymous calls from various cities, such as Indore, Bengaluru, Hyderabad, New Delhi, etc., have reached out to various people across the country to attract them to stock trading by promising them fancy returns.

If anyone is tempted, they must heed the ordeal witnessed by some traders in Hyderabad.

According to a recent The Hindu report, RG Siva Maruthi, ACP of Cyber Crimes, Hyderabad, has revealed that about 20 such cases have already been filed in the Hyderabad Commissionerate alone, in which victims have lost upwards of ₹4 crore.

With data sourcing methods, fraudsters often zoom in on people aged 30-50 years who work in the private sector. The main targets are so-called high-profile professionals such as chartered accountants, software engineers and advocates. A Hyderabad-based advocate lost ₹85 lakh, an IT employee ₹55 lakh, a chartered accountant ₹91 lakh, and another private sector employee lost ₹25.30 lakh to such frauds.

Modus Operandi

The fraudsters use simple and time-tested methods of promising sky-high returns. They lure gullible investors using social media platforms by releasing advertisements on free stock tips and advice. To attract investors, they release fake screenshots of the profits earned by various clients on their social media platforms. Once investors are attracted to invest, the operators initially transfer money as profits to the gullible person’s bank account. Once the target’s confidence is gained completely, the scamsters would insist that the investor subscribe to their premium/VIP channels, promising even more profits.

Once the victims fall prey, they ask them to transfer larger funds into their bank accounts. When investors try to withdraw the fake profits displayed on the website, they are shocked as the withdrawal option is blocked. To unblock the option, scamsters insist on further money transfers, citing various reasons, including taxes and penalties. After extracting the maximum amount, they go incommunicado, leaving investors in the dark with heavy losses.

As fake stock trading scam cases are rising, AV Ranganath, Joint Commissioner of Police, Crimes and SIT, Hyderabad, gave some valuable tips to investors so as not to fall prey to them.

‘Pancha mantras’

He advices investors not to trade stocks in any unknown applications other than those registered with the market regulator SEBI.

“Do not transfer any money to the individual bank accounts as the stock broker facilitates the transfer of the money through their application only,” he said. More importantly, “Do not believe in dubious returns offered by the fraudsters,” he further said.

Another important tip is, “Never share your Demat account credentials with unknown persons.”

He also advises investors not to believe conversations in unknown groups and blindly invest hard-earned money. “Make sure of the authenticity of the applications, while downloading from Google Playstore or their own websites,” says the Chief cop of Telangana.

The exchanges and the Securities and Exchange Board of India need to propagate such messages further with the help of top government officials and popular personalities on public platforms. Besides, SEBI can have a common database pool, including bank details, Aadhaar and PAN details of such identified scamsters for a coordinated probe of various investigations and police offices.

The data can be used as an alert when they try to replicate this in other States when opening a bank account.

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