Fraudulent Investment Websites Under SEBI Scanner: Report
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A large number of fraudulent websites, luring investors with promise of high and quick returns in stock market, have come under the scanner of the Securities and Exchange Board of India (Sebi) and may have to soon shut shop and pay huge penalties.
Sources said that over 50 such websites have come to the notice of the regulator, including through complaints filed by investors and whistleblowers, and penal action has already been initiated against those running illicit operations.
While many such websites have been found to be connected to common operators, the typical modus operandi include soliciting funds from investors under the garb of operating as registered market intermediaries.
The crackdown comes at a time when the regulator is also running a public awareness campaign that says that "high return in less time means more trouble" and warns investors against promises of being made a "millionaire overnight".
Probes conducted by Sebi have found that various entities are claiming themselves to be stock brokers and depository participants through such websites and were fraudulently luring investors on promise of high returns.
These websites are misguiding and the details provided on them false, sources said.
Sebi's advertisements, which read as "Become a Millionaire overnight. How is this even possible?", inform public that high returns in less time "means trouble" and that they should check all investment related documents before investing money.
Earlier this month, Sebi had cracked down on eight entities who were claiming themselves to be stock brokers and depository participants through their respective websites.
The regulator in its order had said that these websites are "misguiding" and the details provided on them "false".
Pending detailed probe into the matter, Sebi has barred - Tradefast Securities, Good Time Securities, Global Securities and Finosys Securities - from the securities market as well prohibited them to raise money from investors, among others, till further orders.
Besides, the restrictions have also been imposed on partners of Finosys Securities and Reliable Securities - Vaibhav Gandhi, Amit Gandhi and Asha Gandhi. SEBI (Proit.NDTV)
Sources said that over 50 such websites have come to the notice of the regulator, including through complaints filed by investors and whistleblowers, and penal action has already been initiated against those running illicit operations.
While many such websites have been found to be connected to common operators, the typical modus operandi include soliciting funds from investors under the garb of operating as registered market intermediaries.
The crackdown comes at a time when the regulator is also running a public awareness campaign that says that "high return in less time means more trouble" and warns investors against promises of being made a "millionaire overnight".
Probes conducted by Sebi have found that various entities are claiming themselves to be stock brokers and depository participants through such websites and were fraudulently luring investors on promise of high returns.
These websites are misguiding and the details provided on them false, sources said.
Sebi's advertisements, which read as "Become a Millionaire overnight. How is this even possible?", inform public that high returns in less time "means trouble" and that they should check all investment related documents before investing money.
Earlier this month, Sebi had cracked down on eight entities who were claiming themselves to be stock brokers and depository participants through their respective websites.
The regulator in its order had said that these websites are "misguiding" and the details provided on them "false".
Pending detailed probe into the matter, Sebi has barred - Tradefast Securities, Good Time Securities, Global Securities and Finosys Securities - from the securities market as well prohibited them to raise money from investors, among others, till further orders.
Besides, the restrictions have also been imposed on partners of Finosys Securities and Reliable Securities - Vaibhav Gandhi, Amit Gandhi and Asha Gandhi. SEBI (Proit.NDTV)
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