Investment scams continue to rise in India, with numerous individuals reporting losses from deceptive schemes promising high returns. A recent case involves an Army doctor from Pune who lost ?1.2 crore to cyber criminals using a fraudulent trading scheme.

How Did the Scam Begin?

The scam, as detailed in the First Information Report (FIR) filed by the victim and reported by The Indian Express, began in mid-July. The doctor received a link inviting him to join a WhatsApp group. Upon joining, he encountered group administrators who promoted high returns from stock market investments. Trusting the group's legitimacy, the doctor engaged in discussions and was convinced to download a trading application.

The application, however, turned out to be a fraudulent platform designed to steal funds. Over a period of about 40 days, the doctor completed nearly 35 transactions amounting to ?1.22 crore, transferring money to various fake bank accounts as instructed by the app. The transactions were presented as investments, with the platform showing inflated returns suggesting earnings of ?10.26 crore. The scammers demanded a hefty sum of ?45 lakh from the doctor to release his funds, threatening to withhold his earnings if he refused.

Suspicious of the situation, the doctor requested the registered address of the trading platform. The provided address in New Delhi proved to be fictitious upon investigation. Realising he had been defrauded, the victim filed a complaint with the Cyber Crime helpline, resulting in an FIR with the Cyber Police Station of Pune City.

This incident highlights a broader trend of online scams where fraudsters use social media platforms like WhatsApp and Telegram to lure victims with promises of high investment returns. Earlier this year, the Securities and Exchange Board of India (SEBI) issued an advisory noting the increasing use of such platforms by scammers who impersonate SEBI-registered Foreign Portfolio Investors and offer fake trading applications.

What Steps Can Be Taken to Avoid Such Scams?

SEBI warns that these fraudulent apps often promise exclusive benefits like share purchases, IPO subscriptions, and institutional account perks without requiring official trading accounts. Scammers typically use mobile numbers registered under false names to remain anonymous and evade detection.

To safeguard against such scams, individuals should:

• Verify sources: Confirm the legitimacy of investment opportunities through trusted sources before committing funds.
• Beware of unknown links: Avoid clicking on links from unsolicited messages, especially those promoting high returns.
• Protect personal information: Be cautious about sharing personal and financial details online, especially with unknown contacts.
• Stay informed: Educate yourself about common scams and fraud tactics to recognize and avoid suspicious behaviour.

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