Nithin Kamath opens up about hacking incidents at Zerodha, shares data

Zerodha co-founder and CEO Nithin Kamath shared some data about the hacking incidents reported at the company.

Zerodha co-founder and CEO Nithin Kamath on Tuesday opened up about "some noise" regarding the hacking incidents at the online brokerage platform.

Taking to Twitter, Kamath explained, “Out of the ~65lk customers who traded with us last year, we have ~100 complaints of fraud. ~ 80 where login details were shared willingly & ~20 where email was hacked (all Rediffmail IDs)."

There has been some noise about the hacking incidents at Zerodha. Here is some data:
Out of the ~65lk customers who traded with us last year, we have ~100 complaints of fraud. ~ 80 where login details were shared willingly & ~20 where email was hacked (all Rediffmail IDs). 1/4

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— Nithin Kamath (@Nithin0dha) August 2, 2022

"As a % of such cases or even normal complaints to overall active customers, we are among the lowest in the broking industry. So this isn't just about us; regardless of the broker, you need to be careful not to share your login details & use a secure email."

The Zerodha CEO further added, “Since all email hacking cases happen to use Rediffmail, it must have some vulnerability being exploited. We blocked Rediff IDs on trading accounts a while ago & have constantly been notifying users. We also now don't send password resets to Rediff email IDs."

He also said that the firm will be launching a tool that disallows trades in illiquid options. “We are soon launching a tool that disallows trades in illiquid options far away from theoretical price + a Kill Switch option to block orders in all penny stocks similar to F&O," Kamath said.

According to reports, Zerodha began to take action to protect clients from cyberattacks after a report revealed how demat accounts of some of the company's customers, among others, were compromised.

The company also plans to launch a feature that will not allow orders for options to be placed at abnormal prices, Nithin Kamath, founder and chief executive at the brokerage house wrote in a LinkedIn post, adding that their method of asking clients for a temporary one-time password is not enough.