Watch out for enticing web of bogus stock-trading platforms

KOCHI: Beware of bogus stock trading apps and websites as several persons have been cheated after making investments expecting high returns. The cyber police station in Kochi recently registered a case based on a complaint from a Thrikkakara resident who lost Rs 2.55 lakh, after being cheated by two persons promising to invest the money through a popular online stock broking company.

Ramesh Narayanan, who has experience in stock investment, was allegedly cheated by Amith, believed to be a Pune native who claimed to be a freelance trader, and Rajveer, claimed to be an Indore resident who introduced himself as the manager of a stock research company. 

“I was doing stock investments on some of the well-known trading platforms before. However, these two persons contacted me on the phone and WhatsApp for convincing me to invest on another platform. Rajveer was the one who tried to convince me to invest. I checked their website which looked very convincing. I transferred the amount via bank fund transfers between January 1 and January 10 this year. The bank account details were similar to those of the online stock broking company,” he said.

Ramesh realised he had been cheated when he checked the bank transfer details and he did not get the promised returns. “From the bank transaction details, I realised that the money did not go to the trading platform’s account. Instead, it went to some personal accounts. In the meantime, they demanded Rs 10 lakh more which I turned down. For convincing me, they transferred a small amount to my account. I went to the court which directed the police to launch a probe. Following this, the police froze their bank accounts but only Rs 10,000 was there,” he said.

The case has been registered for cheating, impersonation and criminal breach of trust. The police said attempts are being made to identify the duo. An expert in share trading said people must be cautious before investing via the mushrooming apps and websites. “The SEBI has a list of investment advisors on its website. Similarly, the approved trading companies are given on the SEBI website. Proper verification should be made before investing money in stocks. During the lockdown period, many people created demat accounts and started stock trading after taking small investments from the public,” he said. 

“People who start investing in stocks should understand that profits and losses are subject to market risk. The bogus companies keep investors in the dark by promising profits and without explaining the risks involved.” Jiyas Jamal, an expert in cyber law and founder of NGO Cyber Suraksha Foundation, said he has several clients who were duped after investing money through bogus stock trading apps and websites.

“One of our clients, a native of Thrissur, had lost Rs 3.5 lakh after investing with a company which approached him. They convinced him by showing their websites, testimonials, PAN and GST details. They initially gave a small amount as returns from share trading. However, one day, his account was found to be frozen,” he said. 

“When we took up the matter with the authorities, it was found that the company which took investments was involved in share trade cheating and the Hyderabad police had frozen all accounts linked with the company.” 

According to Jiyas, such fraudulent companies hire agents in the state to collect investments. He said investments should be made only after thorough verification. Similarly, no investment should be made after being referred to by someone. 

“When the money is lost, people hold these agents responsible. The agents are convinced by the fraudulent firms promising high perks like foreign tours, luxury cars and apartments,” he said.

Con.Com 

• Fraudulent companies hire agents in the state to collect investments from gullible people. Investments should be made only after thorough verification, warn experts
• Several people have been duped after investing through bogus apps and websites