NSE issues warning over unregistered investment scheme

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NSE warning investment scheme

Highlights

NSE warned investors about guaranteed-return offers made by 'Susant' and 'King of Nifty' through the unregistered DEMATE ACCOUNT HANDLING Telegram channel.
NSE clarified that this entity or individual is not recognised as a registered member or an authorised representative of one.
The risk and losses of investing in such unregistered schemes rest entirely with investors, and broker protection and grievance redressal will not be available in the event of a dispute.

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

The alleged scheme and the exchange’s warning

As reported by NSE India, according to the warning issued by NSE, an individual named “Susant,” claiming to be associated with an entity called “King of Nifty,” is offering investors assured or guaranteed returns on stock market investments and account handling services through the mobile number “6375802600” and a Telegram channel called “DEMATE ACCOUNT HANDLING.”

The exchange said that offering any scheme or product promising indicative, assured or guaranteed returns in the stock market is prohibited by law. Investors have been advised not to participate in any scheme offered by such individuals or entities and not to share their user ID or password with anyone.

NSE also clarified that the individual or entity concerned is not registered as any of its registered members or as an authorised person of any registered member. Referring to the “Know/Locate your Stock Broker” feature on its website, the exchange said investors can verify brokers, authorised persons and client bank accounts there.

Risks for investors and lack of available safeguards

The exchange said that participation in such prohibited schemes would be entirely at investors’ own risk, cost and consequences, as these schemes are neither approved nor endorsed by the exchange.

According to NSE, in the event of disputes related to such schemes, investors will not be entitled to investor protection benefits under the exchange’s jurisdiction, the exchange’s dispute resolution mechanism, or the investor grievance redressal mechanism operated by the exchange. The broader implication of this warning is that investors should transact only with registered market intermediaries and independently verify identities and bank details before transferring funds.

Our previous report discussed NSE’s warning on illegal trading schemes and Telegram channels, where activities such as claims of ‘guaranteed returns’ on investments, account handling, and requests for login IDs/passwords had come to light. That article noted that such unauthorised platforms are not registered members/authorised persons of NSE, and investors engaging with them do not have access to the exchange’s dispute resolution and grievance redressal mechanisms; strict penalties also apply under SCRA, 1956.

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