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Scam explainer

Investment and trading scam also called Stock market WhatsApp group scam, Fake trading app scam, Pig-butchering, IPO/institutional account scam

Fake 'stock tips' groups and trading apps show invented profits, take ever-larger deposits and then block withdrawals. It is India's costliest cyber fraud by value.

Published
Conceptual illustration: chat bubbles and a symbolic market chart beneath a fishing hook. Text: STOCK TIPS OR A TRAP?.

AI-generated illustration by CyberShitty. Not a photograph or a document from the organisations named.

How it works

  1. An ad (sometimes a deepfake video of a minister or celebrity), a stranger's message or a new online friend points you to a WhatsApp or Telegram 'stock tips' or 'IPO' group.
  2. A 'professor' or 'mentor' shares tips that seem to work, and other members post screenshots of big profits.
  3. You are asked to install an app or open a website for an 'institutional' or 'VIP' account, and to deposit money into bank accounts that keep changing.
  4. The app shows rising profits, and a small early withdrawal may even succeed to build trust.
  5. When you try to withdraw a larger sum, you are told to pay 'tax', 'fees' or an 'unlock' charge first, and the demands never end.

Composite example, not a real case

The stock tips group with the 'institutional account'

  1. Suresh, 47, a shop owner in Indore, sees a video ad of a well-known public figure recommending a stock tips group, and joins it on WhatsApp.
  2. A 'professor' shares daily tips that seem to work. Other members post screenshots of big profits and thank him.
  3. Suresh is asked to install an app for an 'institutional account' with IPO access. His deposits go to bank accounts that change every few days.
  4. The app shows his money growing fast. A small early withdrawal comes through, so he adds more, including a personal loan.
  5. When he tries to withdraw a larger sum, he is told to pay 'tax' and then an 'unlock fee' first. Each payment brings a new demand.
  6. He stops paying, calls 1930 and files on cybercrime.gov.in with every UPI ID, account number and transaction reference.

Who gets targeted

Anyone with savings and a phone can be targeted, usually through an ad, a stranger's message or a new online friend. An I4C analysis reported in October 2025 found over 30,000 victims in major cities in six months.

Red flags

  • Guaranteed or unusually high returns in days or weeks.
  • Trading apps or links shared in chat groups rather than a SEBI-registered broker you chose yourself.
  • Deposits go to individual or unrelated company bank accounts.
  • A minister, business leader or celebrity 'endorses' the scheme in a video ad.
  • You must pay a fee or tax before you can withdraw your own money.

What to do

  • Do not send more money to 'unlock' a withdrawal; it will not be released.
  • Check any broker or adviser on SEBI's list of registered intermediaries before investing.
  • Call 1930 and file a complaint on cybercrime.gov.in with every UPI ID, account number and transaction reference.
  • Tell your bank so it can alert the receiving banks.
  • Report the WhatsApp or Telegram number through Chakshu on Sanchar Saathi, and leave the group.
  • Beware of 'recovery agents' who later promise to get your money back for a fee.

How to protect yourself

  • Do not join stock tips groups from ads or unsolicited links. A real adviser does not need to recruit you on WhatsApp or Telegram.
  • Before paying for tips or advice, find the person on SEBI's list of registered investment advisers or research analysts, and contact them only through the details SEBI lists.
  • Trade only through a SEBI-registered broker, in an account in your own name, using that broker's app from an official app store. Never install an APK sent in a chat.
  • Before paying anyone, confirm the UPI ID or bank account on SEBI Check. Registered intermediaries use UPI IDs ending in @valid plus the bank's name.
  • Walk away from guaranteed returns, 'institutional' or 'VIP' accounts and pre-IPO offers. NSE says promising assured returns in the stock market is prohibited.
  • Treat a minister or celebrity in an investment ad as a warning sign. The government has flagged AI-generated videos of the Finance Minister and says it has not endorsed such schemes.

Official tools, explained

Step-by-step guideInvited to a stock tips WhatsApp group? How to check it before you send a rupee

The numbers

Deepfake ads are the newest lure: the PIB Fact Check Unit flagged AI-generated videos of the Finance Minister promoting investment schemes in January and April 2026 (News On AIR).

Questions people ask

How do I check if a stock tips group is genuine?

Look up the adviser on SEBI's list of registered investment advisers or research analysts and match every detail. Then check that any payment goes to a UPI ID or account that passes SEBI Check. If the person is not registered, do not pay.

The app says I must pay tax or a fee before I can withdraw. Should I pay it?

No. A fee to 'unlock' your own money is a request for more money, not a way to get yours back. In these scams the balance usually exists only as figures inside the app.

I withdrew a small amount successfully. Doesn't that prove it is real?

No. Letting an early small withdrawal go through is a common way to build trust before you deposit larger sums.

Can I complain to SEBI?

SEBI's SCORES only handles complaints against registered entities, so a fake group or app is a matter for 1930, cybercrime.gov.in and the police. SEBI suggests reporting unregistered people to its market intelligence portal as well.

Someone says they can recover my money for a fee. Should I trust them?

No. Victims are often targeted again by fake lawyers, 'ethical hackers' and recovery agents. No government body charges for a complaint, and no one can pay to speed up a 1930 case.

Desk coverage

Sources

The example on this page is a composite built from how this scam is reported to work. It does not describe a real person.

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