NSE issues investor warning against illegal trading schemes

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NSE investor warning

Highlights

NSE issued an investor warning against illegal trading schemes and channels such as 'Garg Traders', 'Protraders', and 'BULL EYE TRADERS GROUP'.
Under Section 23(1) of the SCRA, 1956, violations may result in imprisonment of up to ten years, a fine of up to Rs. 25 crore, or both.
NSE stated that investors who use illegal platforms will not have access to dispute resolution and grievance redressal mechanisms.

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

Scope of the warning and legal risks

As reported by NSE India, some individuals named "Imran," "Harsh," and "Vijay" claim to be associated with "Garg Traders" and "Protraders" and are operating through the mobile numbers 7090919199, 7505950600, and 9345958844. The exchange said that a Telegram channel named "BULL EYE TRADERS GROUP" is offering securities market-related tips, assured or guaranteed returns on investments, account-handling services by requesting login IDs and passwords, as well as dabba or illegal trading services.

NSE has advised investors not to subscribe to any such scheme or product, as these activities are prohibited by law. The exchange also stated that a police complaint has been filed in this matter.

Under Section 23(1) of the SCRA, 1956, any person or entity violating Sections 13, 16, 17, or 19 may be prosecuted. Upon conviction, they may face imprisonment of up to ten years, a fine of up to Rs. 25 crore, or both.

Verification and protection limitations for investors

The exchange said that investors should not trade on such illegal trading platforms, as they are neither approved nor endorsed by NSE. Investors have been advised to avoid sharing their personal information, especially login IDs and passwords, with any unauthorized party.

To verify the details of registered members and their authorized persons, NSE has provided the "Know/Locate your Stock Broker" feature on its website. The exchange also clarified that investors will not have access to the exchange dispute resolution mechanism or investor grievance redressal mechanism for disputes related to prohibited schemes.

Our previous report covered NSE's warning regarding the ‘Bull Eye Traders Group’ Telegram channel, which mentioned that the channel was offering dabba/illegal trading services and advised investors to stay away. The article also clarified that such unauthorized platforms are not NSE-registered members/authorized persons, that police complaints may be filed against them, and that stringent penalties are provided for under the SCRA, 1956.

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