Stock market scams to move money illegally

16 May 2022

A trader was lured into sharing login credentials on a telegram group by promising high returns. Scammer created a loss & moved it to another account & disappeared. Don’t share login credentials, like a bank, there are illegal ways to move money out of a trading account.

Two ways in which money can be moved once access is compromised: Buying penny stocks which are part of a pump & dump scheme at high prices. Buying illiquid option contracts at a higher than theoretical price and covering back quickly at a lower price.

We saw a large dip in such scams after mandating TOTP for trading penny stocks of questionable repute & options contracts with no liquidity. We are now extending this list of option contracts to a lot more. But this will help only if TOTP isn’t shared by the customer.

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