Big Profits, Bigger Lies: How Fake Trading Apps Are Scamming Investors

Scammers are posing as financial gurus promising large profits via fake apps

Fake trading apps display false profits to deceive investors.

(Photo: The Quint)

Any proposal promising quick and substantial returns with minimal risk on your investment should be approached with caution. We are well-versed in this by now. 

But what if a financial influencer or guru introduces you to new, polished trading apps or portals where you can see your “profit” on screen? The figures are remarkable, and you are one step closer to realising your dream purchase. We’d still ask you to pause.

Scammers are targeting individuals with fake returns through these apps or portals and locking them out of their accounts. 

We dissect the investment scam and help you protect your rupees, and know exactly what to do if the worst happens.

Modus Operandi

• The Introduction: Scammers add you to WhatsApp or Telegram groups, or they might message you directly on social media platforms. They pretend to be financial experts or seasoned investors armed with marketing tips and “insider” news on trading.

• App Download: Fake success stories of profitable trades are circulated regularly to build trust. You are then directed to download a professionally designed fake app or portal complete with dashboards that track your investment(s). They will walk you through the app's operation. 

• Time to Invest: Scammers encourage you to invest a sum, after which the app will display fabricated profits. This further pushes one to invest more, hoping for a larger return.

• Trapped: When you request a withdrawal, scammers will demand additional charges, taxes, or hidden fees - a ploy to extort more money. Even if you pay the amount, the scammers will block or suspend your account and vanish with your money. 

Red Flags

• Offering consistent daily profits, especially in double digits.

• Disclosing hidden fees or charges only at the time of withdrawal.

• Admin or app is not registered with SEBI, or no valid SEBI registration number is displayed on their account.

What To Do

• Verify: It is crucial to check that the app or portal is registered with SEBI.

• Avoid: Use well-known financial apps that can be downloaded from the Google Play Store or Apple’s App Store instead of downloading third-party links.

• Cross-check: Ask other investors in your circle if they know about the app or portal. Look up user reviews, news articles, and even complaints. Any legitimate platform will have an active online presence.

• Decline: Do not share personal details, including banking information.

• Notify: Alert your bank of the transactions (if any) and explore chargeback or reversal options. 

• Report: If you were scammed or were able to spot this scam, then report the incident as soon as possible through the SEBI portal (https://scores.sebi.gov.in/) as well as the government portal - Chakshu (https://sancharsaathi.gov.in/sfc/). You can also submit a complaint through the national cybercrime helpline number—1930. 

The Quint's Scamguard initiative aims to keep up with emerging digital scams to help you stay informed and vigilant. If you've been scammed or successfully thwarted one, then tell us your story. Contact us via WhatsApp at [phone] or email us at [e-mail]. You can also fill out the Google form and help us take your story forward.)

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