Online trading scam: Government issues warning and tips to stay safe

Scam

To make online payments safer, RBI is celebrating the 5th Digital Payment Awareness week from March 10 to 16, emphasising the importance of secure digital transactions. Meanwhile, if you use an app or website for trading, then there’s a possibility that your money is being transferred to scammers, and you have no idea about it.

Well, that’s something the Indian Computer Emergency Response Team (CERT-In) has issued a warning about. Fraudulent trading apps deceive users with promises of high returns, leading to financial losses. The government body has also advised some important guidelines and tips to stay safe and protected while trading online.

How Fake trading scam works
Scammers typically reach out to potential victims through social media, posing as financial experts or influencers. They build trust over time and then introduce a fake trading app, claiming it offers lucrative investment opportunities with minimal risk.

Once users invest, the app falsely displays rising profits, encouraging them to invest more. However, when victims attempt to withdraw their funds, they encounter hidden fees or find their accounts blocked. In many cases, the scammers disappear, leaving investors with significant losses.

How to identify fake trading apps
Investors should be cautious of apps that:
Guarantee unrealistic returns with little or no risk.
Are promoted by unverified social media influencers.
Require money transfers to personal accounts instead of official broker platforms.
Lack proper registration or authorization from the Securities and Exchange Board of India (SEBI).
Have multiple user complaints or negative reviews online.

Tips to stay protected
To avoid falling victim to such scams, investors should follow these safety measures:
Verify broker registration: Ensure the trading platform is SEBI-registered by checking SEBI’s official website.
Use official channels: Download trading apps only from official websites or app stores. Avoid third-party links.
Be wary of influencers: Some influencers promote fraudulent investment schemes. Research before following financial advice.
Avoid personal transfers: Always use official broker channels for fund transfers. Do not send money to personal accounts.
Check for red flags: Look for unusual fees, withdrawal restrictions, or misleading profit displays.

How following this will keep your money safe
With the rise of online trading, cybercriminals are exploiting investors through deceptive apps. By staying informed and verifying platforms before investing, users can protect themselves from financial fraud. If you suspect a fake trading app, report it to the cybercrime department or dual 1903.