Every week someone in Pune loses money to a stock market scam. It usually starts with a friendly WhatsApp message, a Telegram group full of "profit screenshots", or an app promising fixed daily returns. Many victims are careful, educated people. The scams work because they look professional and prey on the hope of easy money. If you're new to the market, our stock market course for beginners covers this in its last week, and this guide gives you the essentials now.
Below are the most common scams, the red flags that give them away, simple checks you can do yourself, and what to do if you've already been targeted.
- No genuine person or institute can guarantee stock market returns.
- Giving buy or sell calls needs SEBI registration. Check it on the SEBI website.
- Only trade through SEBI-registered brokers and official exchange apps.
- Never pay to a personal UPI ID or bank account for trading or tips.
- If you've been cheated, report it on the cybercrime portal and to SEBI quickly.
Fake tip groups on WhatsApp and Telegram
These groups share "sure shot" calls, screenshots of huge profits and messages from happy "members". The first few tips may even work, because the group picks stocks it is quietly pushing up. Once enough people buy, the organisers sell, the price falls, and members are left holding losses.
Many groups then ask you to pay for a "VIP" membership with better calls. Some are pump-and-dump operations, others are simply collecting fees. Either way, sharing buy and sell calls without SEBI registration is not allowed.
Guaranteed-return schemes
"Earn 10% a month", "double your money in a year", "zero risk, fixed profit". No real investment in the stock market can guarantee returns like these. When someone promises them, they are either lying or running a scheme that pays early investors with new investors' money until it collapses.
Legitimate investments always come with risk. The more certain and higher the promised return, the more likely it is a fraud.
Fake trading apps and websites
Some scams use apps that look exactly like real trading platforms. They show your "profits" growing on screen, encourage you to add more money, and then block withdrawals or demand extra "taxes" or "fees" before releasing it. The money was never invested at all.
Offshore forex and crypto apps offering huge leverage fall into a similar trap. Many are not authorised in India, and the RBI keeps an Alert List of unauthorised forex platforms.
Impersonation of brokers, SEBI and experts
Scammers pretend to be from well-known brokers, fund houses, SEBI itself, or famous market experts. They create fake profiles, use real logos and sometimes even AI-edited videos. The message usually leads to a group, an app or a payment request.
Real brokers and SEBI never ask you to join a tips group or pay to a personal account. If a message claims to be official, contact the organisation directly through its official website.
How a pump-and-dump works, step by step
First, the organisers quietly buy a small, rarely traded share at a low price. Then they create noise: messages in groups, fake news, "insider" hints and screenshots of early profits. As members start buying, the price climbs quickly, because there are few sellers in such a small share.
When enough people have bought, the organisers sell everything into that demand. The price collapses, often within days, and the people who bought on the tip are left with shares that are hard to sell at any price. Many victims never realise the tip itself was the trap.
The warning signs are always similar: a small company you had never heard of, urgent messages to buy now, and claims that the price will double soon. Real opportunities don't come with a countdown.
Red flags that give scams away
Promises of fixed or guaranteed returns. Pressure to decide quickly or "limited seats". Requests to pay to a personal UPI ID or bank account. Profit screenshots instead of verifiable information. Someone offering to trade on your behalf with your login. Refusal to show a SEBI registration number, or a number that doesn't match the SEBI website.
Any one of these is reason enough to stop. Two or more is almost certainly a scam.
Simple checks before you trust anyone
Check any adviser or research analyst on the SEBI website using their registration number. Check that your broker is SEBI-registered and that trades appear in your contract notes and on the exchange. Download trading apps only from the official app store listing linked on the broker's own website.
For forex, check the RBI Alert List. For any course, check that the trainer is named, the syllabus is written down and there are no return promises.
What to do if you have been targeted
Stop sending money immediately, even if they ask for "one last fee" to release your funds. Save screenshots of chats, payment details and the app or website. Report cyber fraud on the national cybercrime portal or by calling the 1930 helpline as soon as possible.
You can also file a complaint with SEBI through its SCORES portal if a registered entity is involved, and inform your bank about fraudulent transactions. Acting fast improves the chance of stopping or recovering payments.
A typical story we hear in class
This is a composite of stories students have shared, with details changed. A salaried professional joins a free WhatsApp group after seeing an ad. For two weeks the group shares small, correct calls, and the admin posts screenshots of members' profits. Then comes an invitation to a "premium" group for a fee, with bigger calls and a trading app the group recommends.
The app shows steady profits, so more money goes in. When the time comes to withdraw, the app asks for a "tax clearance" fee first. After that is paid, there is another fee, and then the group disappears. Nothing about the early calls was luck. They were the bait.
The pattern is the same almost every time: free trust-building, a paid upgrade, a private platform, and blocked withdrawals. Knowing the pattern is the best defence.
How to protect parents and family members
Retired parents and older relatives are often targeted, especially through calls and WhatsApp messages that look official. A calm conversation helps more than a warning. Explain that no real adviser or broker will ever ask for money in a personal account or promise fixed returns.
Agree on a simple rule together: before sending money to anyone about investments, they call a family member first. Help them save the 1930 cybercrime helpline number, and show them how to check a SEBI registration. Small habits like these stop most scams before they start.
A 60-second checklist before you pay anyone
Is the person or firm SEBI-registered, and does the number match the SEBI website? Are they promising a fixed or guaranteed return? Are they asking you to pay into a personal UPI ID or bank account? Are they rushing you to decide today?
Does the app come from your broker's official website and the official app store? Can you withdraw a small amount to your own bank account before adding more? If any answer worries you, stop and ask someone you trust. A genuine opportunity will still be there tomorrow.
The best protection: learn properly
Scams work on people who don't yet understand how the market really behaves. Once you know that prices are uncertain, that risk can't be removed, and that real learning takes practice, promises of easy money stop sounding believable.
That is why our courses teach risk before returns, practise on past data, and never come with a tips group.
Common beginner questions
How do I check if an investment adviser is SEBI-registered?
Ask for their SEBI registration number and search for it on the official SEBI website under registered intermediaries. The name and details must match exactly.
Are stock tips on WhatsApp and Telegram legal?
Sharing buy and sell recommendations as a service requires SEBI registration as a research analyst or investment adviser. Most tip groups are not registered.
Where do I report a stock market or trading app fraud?
Report cyber fraud on the national cybercrime portal or call the 1930 helpline quickly. You can also complain to SEBI through SCORES and inform your bank.
Can a fake trading app really show my profits?
Yes. Fake apps display made-up numbers to convince you to add more money. The real test is whether you can withdraw to your own bank account, and whether trades appear on the exchange.
Why do tip groups share correct calls at first?
Early correct calls build trust. Some are based on shares the organisers are pushing up themselves, and others are simply sent to different groups with different calls so some groups always see winners. The trust is then used to sell paid memberships or push fake apps.
Is it safe to give someone my trading account login to trade for me?
No. Sharing your login lets someone trade, and sometimes withdraw, without your control, and you remain responsible for every trade. Genuine advisers never need your password.
