Trading fraud costs 272 Pune residents Rs 125 crore since January 2024

Cybercriminals target people using social media, offering them fraudulent investment opportunities, promising extraordinarily high returns

More than 272 individuals from Pune have fallen prey to online share trading scams, resulting in a collective loss of more than Rs 125 crore since January 2024, reports The Indian Express. The victims, including many experienced investors, were enticed into these fraudulent schemes by the promise of extraordinarily high returns. The scammers employed deceptive tactics, including the use of counterfeit apps that mimic legitimate trading platforms.

Registered 222 cases, Rs 101.5 cr lost

The Pune City Police have registered 222 cases related to these scams between January 1 and July 31, with total losses amounting to Rs 101.5 crore. Each victim lost an average of over Rs 45 lakh. Of these cases, 85 are particularly significant, involving losses ranging from Rs 50 lakh to Rs 4 crore, with a total loss of Rs 73.6 crore. An additional 137 cases are being investigated by other police stations, with a total loss of Rs 27.9 crore.

 

In the jurisdiction of Pimpri Chinchwad, another 50 cases have been reported, with victims losing over Rs 25 crore. These cases are under investigation by the cyber cell of the Pimpri Chinchwad police.

How are these cybercriminals defrauding people?

The cybercriminals behind these scams targeted potential victims through social media or direct messages, offering investment guidance and promising unrealistic returns of up to 1,000 per cent. Victims are then added to WhatsApp or Telegram groups where they are provided with online lessons and are encouraged to use certain share trading apps designed by the scammers. These apps often bear names similar to those of well-known international investment firms, giving them an air of legitimacy.

Once the victims begin transferring money, the fake apps display artificially high returns, encouraging further investment. When the victims attempt to withdraw their earnings, they are asked to pay additional fees under the guise of taxes or processing charges. Eventually, the scammers disappear, leaving the victims without their money.

The report revealed that these scams are orchestrated by multi-layered criminal networks, with the masterminds often operating from countries in West Asia or Southeast Asia. The money is funnelled through rented accounts in India and then transferred abroad, often via cryptocurrency.

Sebi issues advisory against scams

In response to the growing number of scams, the Securities and Exchange Board of India (Sebi) issued an advisory on February 26, warning investors about fraudulent schemes. Sebi highlighted that scammers are using online trading courses, seminars, and mentorship programmes to entice victims. 

These fraudsters pose as employees or affiliates of Sebi-registered Foreign Portfolio Investors and encourage individuals to download fake apps that promise institutional benefits without requiring official trading or Demat accounts. Sebi urged investors to verify the authenticity of platforms before investing and to be cautious of offers that seem too good to be true.