BTech student with no income lost Rs 26 lakh on F&O trading, reveals CA after filing ITR: 'He's addicted'

Roshan Agarwal has been a chartered accountant for four years and had been approached by the student via Facebook last year. (Image credit: Moneycontrol)

Amid the flurry of filing income tax returns, a chartered accountant has recently put the spotlight on the dangers of getting addicted to trading despite suffering losses. Assam-based CA Roshan Agarwal revealed that one of his clients, a 3rd year BTech student who does not have a source of income yet, filed a loss of Rs 26 lakh from trading in futures and options (F&O) in the financial year 2023-24.

"Last year, he lost Rs 20 lakh in trading," Agarwal said. He told Moneycontrol that the student had approached him via Facebook -- where Agarwal offers financial advice -- two years ago to help him file his income tax returns.

"His parents are separated. His mother runs a hotel business but none of them know about this," the CA told Moneycontrol. "He has no income and took personal loans from financial apps, borrowed money from friends, and withdrew some money from his parents' account without them knowing."

Agarwal said that the student has been making financial decisions based on what he sees on social media, and from his friends. "One of his friends made Rs 1 crore last year from F&O trading... I have seen the statement. He was influenced by that and from what he heard financial influencers say on social media," he said.

After the first year of loss, Agarwal said he had strongly recommended the student stop trying to look for easy ways to make money and although he appeared to be convinced at the time, this year, he returned to file his income tax returns with an even bigger loss.

"When I asked him the reason, he said he was addicted to trading and has been unable to quit it... Influencers on Instagram and Telegram are selling dreams of being rich quickly and it's the innocent such as this student who fall prey to this," he said. The CA added that this time, the student has promised not to spend on such trades because he would graduate soon and would instead focus on earning money.