NSE warns investors about illegal dabba trading services

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NSE's dabba trading warning

Highlights

The National Stock Exchange of India issued a warning about illegal dabba trading platforms operated by Swati Gupta through a mobile number, a Facebook group and the 'Bull Tiatans' app.
The individual concerned is neither an NSE-registered member nor an authorized representative, and investments on such platforms will be entirely at investors' own risk.
Participation in dabba trading may result in imprisonment of up to ten years or a fine of up to Rs. 25 crore under Section 23(1) of the Securities Contracts (Regulation) Act, 1956.

This article was translated from the original. Read the original version by our correspondent here.

Complaint, platforms and regulatory warning

According to a press release issued by NSE India, the National Stock Exchange of India said that an individual named “Swati Gupta” is allegedly providing dabba or illegal trading services through mobile number 8359821986, a Facebook group called “Stock Market (Dabba Trading),” and an application called “Bull Tiatans.” The exchange has urged investors not to subscribe to any such scheme or product offered by any person in the stock market, as such activities are prohibited by law.

NSE also noted that its website offers a “Know/Locate your Stock Broker” facility, allowing investors to verify registered members and their authorized persons. According to the exchange, the individual concerned is neither listed as one of its registered members nor as an authorized representative of any registered member.

Legal and financial risks for investors

The exchange stated that violations of certain provisions under Section 23(1) of the Securities Contracts (Regulation) Act, 1956 may result in prosecution and, upon conviction, imprisonment for up to ten years, a fine of up to Rs. 25 crore, or both. Under Section 25, such offences are considered cognizable, and state law enforcement agencies may also investigate them.

NSE also stated that dabba trading falls within the scope of certain provisions of the Bharatiya Nyaya Sanhita, 2023. The exchange warned investors that participation on such illegal platforms will be entirely at their own risk, cost and consequences, as they are not approved or endorsed by the exchange.

Investors have also been informed that investor protection benefits, dispute resolution mechanisms and investor grievance redressal arrangements under the exchange's jurisdiction will not be available for disputes related to prohibited schemes.

Our previous report mentioned NSE's warning regarding alleged dabba trading services linked to Akhil Singh, which involved allegations of illegal trading through mobile numbers, Facebook groups, APK links and a website. That article noted that the individual concerned was not listed as a registered member or authorized representative, and investors were advised to verify details using the “Know/Locate your Stock Broker” tool. It also highlighted risks such as strict legal penalties for participating in dabba trading and the unavailability of investor protection and grievance redressal mechanisms.

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