- NSE warns against unauthorized stock tips and guaranteed returns.
- Beware of social media channels promising quick, assured profits.
- Verify broker credentials on NSE website before engaging.
India’s leading stock exchange, the National Stock Exchange (NSE), has issued a fresh warning to investors and traders, cautioning them against engaging with unauthorised individuals and platforms offering stock market tips and assured returns.
The advisory comes amid rising instances of fraud linked to social media channels, messaging apps and unregistered trading services that promise quick profits, a red flag in regulated financial markets.
NSE Flags Telegram Channel Promising ‘Guaranteed Returns’
In its latest communication, the NSE said it has identified a person named ‘Nitin’ who is allegedly operating a Telegram channel titled ‘Everyday Power Of Stocks’, reported IANS.
According to the exchange, the individual is offering stock market tips, claiming guaranteed returns and even providing account handling services to investors.
Such practices are illegal under market regulations, as no entity is permitted to assure returns in the securities market.
Illegal ‘Dabba Trading’ Network Also Under Scanner
In a separate case, the NSE highlighted the activities of an individual identified as Satendra Dubey, linked to an entity called ‘Wealth Trading’.
The exchange said the person is allegedly offering dabba trading, an illegal practice where trades are executed outside recognised exchanges, through multiple online channels, including websites, mobile applications, Facebook groups and Instagram pages.
Importantly, the NSE clarified that the individual is neither a registered trading member nor an authorised intermediary associated with any of its recognised brokers.
Why Assured Returns Are A Red Flag
The NSE reiterated that any scheme promising fixed or guaranteed returns in the stock market should be treated with extreme caution.
Financial markets are inherently volatile, and returns cannot be predicted or assured. As a result, any such claims are not only misleading but also prohibited under existing laws.
The exchange urged investors to avoid subscribing to such schemes, regardless of how convincing the marketing may appear.
Don’t Share Your Trading Credentials
Alongside cautioning against fraudulent schemes, the NSE also advised investors to safeguard their trading accounts.
Sharing sensitive details such as user IDs, passwords, or one-time passwords (OTPs) with third parties can expose investors to significant financial risk.
Unauthorised access to trading accounts can lead to misuse of funds, unauthorised trades and potential losses.
How To Verify A Broker Or Advisor
To help investors stay safe, the NSE emphasised the importance of verifying the credentials of brokers and authorised persons before engaging with them.
The exchange provides a ‘Know/Locate your Stock Broker’ facility on its official website, which allows users to check whether an individual or entity is registered and authorised to operate in the market.
This simple step can significantly reduce the risk of falling victim to fraud.
No Protection In Unauthorised Deals
The NSE also warned that investors who participate in such unauthorised schemes do so entirely at their own risk.
Transactions conducted outside the regulated framework are not covered by investor protection mechanisms offered by the exchange.
This means that in the event of a dispute, investors will not have access to grievance redressal systems, arbitration processes or compensation mechanisms typically available for regulated trades.
With the increasing use of social media and digital platforms, fraudulent actors are finding new ways to target retail investors. While the promise of quick profits can be tempting, experts stress that disciplined investing through regulated channels remains the safest path.
