Online trading scam: Why Indians keep falling for it and how to stay safe

Online trading scams have become one of the fastest-growing types of cybercrime in the country. Fraudsters use fake trading platforms, WhatsApp groups, and celebrity images to lure unsuspecting investors, promising sky-high returns (at times, a 100 per cent return). Once the victims start depositing money (a small amount), the scammers start to show them the return, and at times give money to their bank accounts just to earn their trust. Later, when the investors start to rely and invest bigger amounts, the scammers disappear, and recovering the funds transferred by the investor becomes almost impossible.

How do these trading scams work? 

These scammers are smart enough to fool people in a very professional way. Here are a few trending methods by which they are fooling people: 

1. Fake apps and websites: Scammers create professional-looking trading apps and websites that mimic real platforms. These apps often show fake profits to encourage victims to invest more.
2. WhatsApp and Telegram groups: Fraudsters add people to different groups, claiming to offer trading tips. These groups are filled with fake success stories to build trust. Also, their other group members pretend to be someone who invested and has gained a number (luring the potential investor)
3. Fake celebrity endorsements: Scammers misuse images of public figures like Ratan Tata, Mukesh Ambani and even Sachin Tendulkar, to make their fake platforms seem credible.
4. High return promise: Victims are promised up to 5–10 per cent of daily returns initially— something no legitimate platform guarantees. Once a large sum is invested, the app stops responding or blocks the user.

Why do people still fall for such trading scams or investment scams?

1. Lack of financial awareness: Many users (mid-senior or senior citizens) do not understand the high profits, and they always come with high risks.
2. Desperation for extra income: Especially post-pandemic, many are looking for easy ways to earn money.
3. Low digital literacy: Users often fail to check app authenticity or read terms and conditions.
4. Social proof pressure: Seeing others “earn” easily in group chats pushes people to try it themselves.

How to protect yourself from such a scam

Being mentally alert is the only way to be safe from such scams. There are multiple ways to keep yourself safe, and do not believe in strangers who claim to be your well-wisher. Do remember “all that glitter is not always gold!” Here are some ways to keep a check on yourself to be safe during the rise in cybercrime.

1. Use only SEBI-registered platforms: Stick to trusted trading apps like Zerodha, Groww, or Upstox.
2. Verify apps on Play Store/App Store: Check ratings, reviews, and developer info before downloading.
3. Never trust unrealistic returns: If it sounds too good to be true, it probably is.
4. Do not share personal information: Avoid giving PAN, Aadhaar, or bank details to unknown sources.
5. Report scams: File a complaint on cybercrime.gov.in or contact your local cyber cell.

Online trading offers real opportunities, but only through regulated platforms. You must not transfer the amount to any random bank account, or you will be in grave danger. I know some people who have lost their lifelong investment and got no penny in return- even the police were unable to help them despite visiting the station multiple times.

We suggest you stay cautious, research well, and never let greed override your judgment. Cybercriminals are smart — but with awareness, you can be smarter.