Rapid Fire
SEBI Warns Against Fraudulent Trading Platforms
- 15 Mar 2024
- 1 min read
The Securities and Exchange Board of India (SEBI) has issued a cautionary statement regarding deceptive trading platforms falsely asserting ties with its registered Foreign Portfolio Investors (FPIs).
- Pretending as SEBI-registered FPIs, they entice individuals to download applications promising access to stock purchases, IPO subscriptions, and exclusive 'institutional account benefits.'
- These platforms lure individuals through online trading courses, seminars, and mentorship programs, exploiting social media platforms like WhatsApp or Telegram.
- SEBI clarified that the FPI route is not accessible to resident Indians, with limited exceptions outlined in the SEBI (Foreign Portfolio Investors) Regulations, 2019.
- Also, there is no provision for an Institutional Account.
- FPIs encompasses financial investments made by foreign individuals, corporations, and institutions in Indian financial assets like stocks, bonds, and mutual funds.
- Unlike Foreign Direct Investment (FDI), which involves long-term ownership of assets, FPI is primarily driven by the aim of achieving short-term gains and portfolio diversification.
Read more: Securities and Exchange Board of India (SEBI), Foreign Portfolio Investors
