India is dealing with a rise in investment scams, with many falling victim to fraudulent trading schemes. Recently, an Army doctor from Pune lost Rs 1.2 crore to cybercriminals.
The scam began when a doctor was added to a WhatsApp group and persuaded to download a fraudulent trading app that was designed to siphon funds from users, a report by Indian Express said.
The doctor made investments worth Rs 1.22 crore over 40 days as directed by the app. The platform falsely indicated his earnings as Rs 10.26 crore, but when he tried to withdraw the funds, the fraudsters demanded a fee of over Rs 45 lakh. He suspected fraud and conducted further enquiry confirming his doubts, after which he filed a complaint with the Cyber Police Station of Pune City police.
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Five Signs That Should Warn You About A Potential Scam
Unsolicited Advice: Cybercriminals are increasingly using social media channels such as WhatsApp and Telegram, along with live broadcasts, to lure potential targets. Be cautious of strangers reaching out with investment offers or financial advice through emails, calls, or social media. A good financial advisor won't reach out to you without you seeking their advice. Scamsters use mobile numbers registered under false identities, to operate anonymously. Always check the legitimacy of any source offering investment opportunities before making a decision.
High Returns: Scammers frequently attract investors by making enticing promises of unusually high returns, such as doubling your investment in a concise time frame. After the exceptional bull run since COVID-19, any genuine investments usually generate returns of around 12-15 per cent annually unless derivative strategies are involved. Investors should remember that if an investment opportunity sounds too good to be true, it most likely is.
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Exclusive Benefits & Trading Through Their Demat Account: Fraudulent apps falsely promise exclusive benefits like buying shares, subscribing to IPOs, etc. Some offer to trade through their demat account on your behalf, which is another red flag. To avoid falling victim to such scams, individuals should verify their registration and licenses, especially when dealing with unfamiliar apps or platforms.
Lack of Transparency: If they ask you to download bogus applications that mimic legitimate trading platforms, it is a no-brainer that you are up for fraud. But sometimes, the bogus applications can be stand-alone. Here caution should be taken to independently verify the platform's reach, their physical address, registration, license, etc. Legitimate brokers will only facilitate transactions through regulated platforms. Never share your Demat account credentials, share personal or financial information or transfer funds to unknown accounts.
Testimonials: Scammers often use fake testimonials or endorsements from supposedly satisfied customers to build credibility. If someone uses testimonials to boost their credentials, don't they sound too desperate? Yes, it is a red flag. They might use screenshots of earnings or create fake social media profiles to project authenticity.
