BSE cautions investors against investing in advice from fraudulent trading apps
May 29, 2024
Mumbai (Maharashtra) [India], May 29 : The BSE Investor Protection Fund has cautioned investors to beware of fraudulent trading apps that promise unrealistic returns through block deals and IPO allotments.
According to the fund, SEBI (Securities and Exchange Board of India) has been receiving numerous complaints from investors and intermediaries about deceptive trading activities falsely claiming to be associated with prominent SEBI-registered financial institutions.
It added that these impersonators typically operate via social media platforms and messaging apps, such as Facebook pages and WhatsApp groups. They lure investors with promises of guaranteed high returns. Believing they are dealing with legitimate registered intermediaries, investors download these apps and invest through them.
However, their investments are not actually made on the Stock Exchanges but are instead confined to paper trades within the app. When investors attempt to withdraw substantial amounts, the app often becomes non-functional, revealing the scam.
The BSE Investor Protection Fund has clarified that these apps are misleading investors and are not registered with SEBI for trading. It advises investors to verify the legitimacy of trading apps and intermediaries through the BSE website.
"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," said the BSE Investor Protection Fund.
https://www.bseindia.com/members/MembershipDirectory.aspx
This advisory aims to protect investors from falling victim to these fraudulent schemes. The fund emphasizes the importance of due diligence and verification before engaging in any investment activities, especially through online platforms.
By checking the registration status and authenticity of trading members on the BSE website, investors can ensure they are dealing with legitimate entities and avoid potential losses from fraudulent activities.
The basic functions of the Securities and Exchange Board of India (SEBI) is to protect the interests of investors in securities and to regulate the securities market.
