Sebi cautions investors against fraudulent trading platforms offering stock market access via FPI route

Capital markets regulator Sebi on February 26 cautioned investors against fraudulent trading platforms, claiming to facilitate stock market access to Indians through Foreign Portfolio Investors (FPIs) route.

Sebi noted that fraudsters are enticing victims through online trading courses, seminars, and mentorship programs in the stock market, leveraging social media platforms such as WhatsApp or Telegram, as well as live broadcasts.

Posing as employees or affiliates of Sebi-registered FPIs, they coax individuals into downloading applications that purportedly allow them to purchase shares, subscribe to IPOs, and enjoy “institutional account benefits”— all without the need for an official trading or demat account, Sebi said adding that these operations often use mobile numbers registered under false names to orchestrate their schemes.

The cautionary statement came after Sebi received a number of complaints regarding fraudulent trading platforms.