SEBI issues alert on fraudulent closed WhatsApp groups offering stock tips, fake returns, and phishing apps targeting retail investors.
SEBI Alerts Public on WhatsApp-Based Market Fraud
SEBI has issued a public advisory warning against invitation-only WhatsApp groups that disseminate unsolicited stock recommendations, often accompanied by fabricated profit screenshots and testimonials. These groups frequently promote fake trading applications and demand upfront fees under the guise of ‘guaranteed returns’.
The regulator highlighted common patterns: initial small gains to build trust, pressure to increase investment, and eventual unavailability of funds. In some cases, investors are redirected to new groups after the original one is exposed, indicating organized fraud networks.
SEBI reiterated that no entity or individual can legally provide ‘investment advice’ without registration. Practitioners should educate clients on recognizing red flags and emphasize reliance only on SEBI-registered intermediaries. Firms may consider including these risks in investor awareness programs.