SEBI Warns Investors Against Fake WhatsApp Groups Offering Stock Tips, Trading Advice and False Profit Claims:

The Securities and Exchange Board of India (SEBI) has warned investors against joining private WhatsApp groups that offer stock tips and trading advice. The regulator said fraudsters use fake profit claims and messages praising market experts to make their advice look genuine and attract investors.

In a press release issued on Thursday, SEBI said some unregistered individuals were running these groups, often using foreign WhatsApp numbers. They offer buy and sell recommendations in the name of free investor education, even though they are not authorised to provide such services.

SEBI said some members of these groups work with the operators to post fake profit claims and praise their recommendations. This practice, known as astroturfing, creates a false impression that the group is trustworthy and that its trading advice is successful.

The regulator also warned about a trick used to bring members into new groups. After action is taken against a group, members may receive messages from a new number claiming that the old group has been banned due to the platform’s safety measures. They are then invited to join another group that promises daily stock tips and trading advice.

SEBI has advised investors not to join private WhatsApp groups run by unknown people or those claiming to be market experts, especially if they use foreign numbers. It also asked investors not to trust profit screenshots, trade confirmations or messages praising group operators, as these could be fake.

The regulator said messages claiming that a group has been suspended, closed or banned, followed by an invitation to join a new group, should be treated as warning signs. Investors should leave such groups and avoid following their advice.

SEBI also cautioned investors against opening trading accounts on apps recommended by these groups, sending money to them or sharing details of their investments and trading accounts. It advised investors to deal only with SEBI-registered intermediaries and use genuine trading apps.

Investors can check whether a broker or other intermediary is registered on SEBI’s official website. They can also use SEBI’s investor support portal to verify trading apps before using them.