India’s markets regulator says unregistered operators are using fake profits, planted praise and overseas numbers to make fraudulent stock-tip groups appear credible.
India’s markets regulator has warned investors to steer clear of WhatsApp groups that use fake praise, inflated profit claims and other misleading tactics to sell stock tips, saying the schemes are designed to look credible while steering people towards risky trades. In a statement issued on Thursday, the Securities and Exchange Board of India said some unregistered operators were posing as market experts in invitation-only groups, often through overseas numbers, and were presenting their messages as free investor education.
SEBI said the groups frequently rely on a tactic known as astroturfing, in which accomplices post upbeat messages, false trading gains and praise for the so-called expert to create the impression of genuine support. The regulator said that can persuade inexperienced investors to follow recommendations that were never properly vetted. It also warned that the same operators often reappear under a different number after a group is closed, claiming the previous one was banned because of platform restrictions and inviting members to join a new channel.
The regulator urged investors not to trust invitation-only groups run by unknown people or by anyone claiming to be a market specialist, particularly when the contact comes from an overseas number. It also said messages celebrating profits, confirming trades or urging people to move quickly should be treated as warning signs, because such posts may have been planted to manipulate behaviour. SEBI advised investors not to open accounts on, or send money to, trading platforms recommended through these groups, and not to share holdings or account details with their operators.
The warning fits a broader effort by SEBI to combat online investment fraud, which has also included alerts about impersonation scams, manipulative social media content and fake trading platforms. Zerodha co-founder Nithin Kamath has separately cautioned investors against blindly following stock tips spread through WhatsApp, Telegram, SMS and social media, saying such schemes remain common despite the abundance of financial information available online. His remarks echoed SEBI’s message: investors should verify claims independently, deal only with registered intermediaries and use only official trading apps.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
