As retail investor participation in India’s stock markets soars to unprecedented levels and social media usage reaches new peaks, a parallel surge in stock market-related fraud has prompted the Securities and Exchange Board of India (SEBI) to sound the alarm.
According to recent government data cited in a report, more than 150,000 people fell victim to stock market scams in the past year alone — the highest number on record. Alarmingly, over 400 such frauds are being reported daily, culminating in a staggering loss exceeding $1 billion (approx. ₹8,300 crore) in 2024. Despite efforts, less than 10% of the defrauded money has been recovered so far.
With over 130 million unique trading accounts—nearly triple the number from five years ago—India’s growing pool of retail investors has become a prime target for sophisticated scammers exploiting social media platforms and digital communication channels.
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In response, SEBI has issued fresh advisories to safeguard investor interests and curb the spread of cyber-enabled market manipulation. The regulator highlighted four major types of frauds proliferating across platforms like YouTube, WhatsApp, Telegram, Instagram, Facebook, and app stores:
1. Unregistered Investment Advisory Services
Scammers falsely claim SEBI registration or use forged certificates to pose as legitimate advisors, offering seemingly professional guidance with the aim of defrauding investors.
2. Impersonation of SEBI-Registered Entities
Fraudsters create deceptive trading platforms or social media channels impersonating licensed entities, often promoting “risk-free” or “guaranteed” returns to dupe investors.
3. Manipulative Social Media Content
Scam artists publish misleading posts or fake testimonials encouraging users to join exclusive chat groups with names like VIP Traders Club, Institutional Trading Group, or Discounted IPO Community, enticing them with false investment opportunities.
4. Fake Apps and Platforms Offering ‘Exclusive’ Services
Fraudulent mobile applications or websites promise special services such as discounted IPOs, institutional trading access, or preferential block deals to lure unsuspecting investors into transferring money or sharing sensitive financial data.
In light of these threats, SEBI has urged investors to stay alert and verify the credentials of any advisory or trading service they engage with. To assist the public, SEBI maintains an up-to-date list of registered intermediaries and verified trading apps, accessible via:
Additionally, SEBI has mandated all registered intermediaries to use only the ‘1600’ phone number series for voice-based service and transactional calls. This initiative aims to help investors distinguish authentic communication from scam calls.