Beware of online share trading frauds
The Indian stock market is one of the world’s best performing stock markets. The National Stock Exchange (NSE) is the second fastest growing stock exchange in the world. Investment in shares provides higher returns than those of bank deposits. With the Indian economy booming, many people with disposable income are investing in share market to get high returns. But scammers are duping many such novice investors by enticing them to join unauthenitic online share trading groups on WhatsApp by promising them unusually very high returns. Corporate Citizen brings to you the risks involved in joining such online groups and precautions to be taken for not falling prey to the online share trading frauds
Modus Operandi: Fraudsters lure victims by sending unsolicited messages through social media promising very high returns through online share trading, after they join a particular group. The gullible person after joining the group is asked to download an app and become a member of the group for share trading to get high returns. The victim is asked to invest in shares of companies recommended by the admin or his assistant. He/she can see the high returns on his investment on the app but cannot withdraw it. He/she is asked to pay the charges on earned profit to the company after which only the amount can be withdrawn. But on investigation, the person comes to know that the company does not deal in any share trading, after which the victim realises that he/she has been duped. This compels the victim to lodge a complaint with cyber police, expecting to recover their investment and profit.
Case Study: An army doctor officer lodged a complaint with Cyber Police Station, Pune, on 7 September, 2024, that he has been duped of Rs 1.22 crore in an online share trading fraud.
The victim in his complaint states that he joined a WhatsApp group through a link received on a text message on 15 July, 2024. He joined another WhatsApp group through another link and downloaded an app for online share trading.
Many members posted messages about earning high returns through online share trading. He purchased some shares and the app showed that he has earned a profit on them. He invested in shares a total amount of Rs 1.22 crore, till 26 August, 2024. The app showed that he had earned Rs 10.26 crore till then. He tried to withdraw the money but in vain. He was asked to pay 5 per cent of the earned amount, of around Rs 46.45 lakh to the company, to be able to withdraw his money. He asked the trading company to deduct Rs 20 lakh from the earned amount and give the remaining to him. But, he was told that he will have to pay the full amount of Rs 46.45 lakh to an individual bank account. He was provided the address of a company having office in New Delhi, when he asked for the company address. He went at the given address and found that the company does not trade in shares. On realising that he has been duped of Rs 1.22 crore, he lodged a complaint with Pune Cyber Police Station.
Swapnali Shinde, police inspector, Cyber Police Station, Pune said, “Investigations are in progress about this case. If you are duped then immediately lodge complaint on www. cybercrime.gov.in and later contact the local cyber police station.” She appealed to people to not to click on link sent by unknown persons and not to join any group through link sent by unknown persons.
The victims of any online financial frauds can lodge a police complaint from anywhere in the country on www.cybercrime.gov.in. They can also contact the cybercrime helpline on 1930, to seek help.
Preventive Steps
- Don’t click on link sent by unknown persons
- Don’t believe in the promise of unrealistic high returns
- Ask for a valid SEBI/RBI licence and authenticate it before investing
- Never share passwords or OTP with anyone