SMS Scams in Stock market in India

Updated: Apr 10, 2021

It is said that even one SMS can change your life, I know that may not be an ethical way or idea. Here I am sharing with you all about Stock Scam. My channel Mark2Market on YouTube is also primarily dedicated to Make Money.



Let’s have a quick understanding of how this scams scandal works!!!

Scams in the stock market that will lead you to lose money because there are a lot of scamsters are active in the market more than the outside world. These scamsters are so smart that even the Law can’t touch their dealing. So in this whole series what I am going to tell you is how these scamsters trap the people and how it works and what will be its modus operandi and the way you can avoid them. It’s humbly requested to spread this scam awareness to each one of us even more about the Retail Investor because these are the people being targeted and underrated by scam. These small investors are small savers, they do the saving of their hard earned money and when they get trapped, negative news about the stock market reflects. The main purpose behind this topic is to spread awareness among the innocent retail investors as this scam is actually a criminal offence or called as White collar crime.

It is basically happens when these scammers get the important data regarding the Demat Account Holder and Trading Account holders bout the retail user from the market brokers who are indulged in these activities or even not only the broker but also from the employee of the broker can fetch the relevant information details and sell it into the market.

In most of the cases, new investors who have opened their account for the first time are generally targeted by these scamsters as these scamsters know very well that these people have tiny knowledge into this market.


For Example:-


On the first time, what scamsters does:


Scamsters buy data of 10000 demat account holders and Trading account holders. They divide this data into parts that are Group A and Group B for each 5000 people and offer these groups the company’s stock let’s say Maruti company stock for group A and Reliance company stock for group B. Merely a single SMS, scamsters send the trend estimate of this stock. In one SMS to group A, they write” Buy this stock, this is going to rise” and in another SMS sending to group B, they write” Sell the stock or short this stock or take a Short strategy on this stock, as this stock is going to fall. It’s obviously, stocks will either go to Up or Down and no Research and Development is required.

So let’s say, Advices given for Group B people become right as next day of receiving the SMS with respect of the Stock price fall got correct and about 2500 people from Group B, they might buy that stock based on this tricky advice and rest of the people of this group B have just cross checked the data on the next day of the stock’s estimation of whether the stock price actually down or not and actually these people found correct tips of the scamsters.




On the Second time, what scamsters does:


Now what the scamsters do is they simply delete the Group A data and again they will divide the 5000 data of people into two i.e. 2500 people for new group C and 2500 people for new group D. Now then Scamsters pick new another stock let’s say, HUL stock for group C and ITC Stock for group D people and will again follow the same process as did in the first time (above mentioned) that is, for one group they will send SMS “Stock is about to going upward so to buy “and for another stock, “stock is going to down so sell it”. And now in this group C and D, somebody from the group B will surely fall in this trap either they will buy or sell some shares or they will just cross check the advised trick. So if the prediction for group D is going to be correct, surely these people think in their mind and even convinced these people (scamsters) are really someone who is really helpful and actually God is helping them.


On the Third time, what scamsters does:


Scamsters then divide the rest of 2500 people into two more new groups that are Group E and Group F of 1250 people for each of these new groups. So now people who fall into Group F, they are damn sure now, this SMS is coming itself from God and people are going to follow for sure as it can’t be possible that if somebody gives 3 tips and all they are going to be in the right direction. And now out of 1250 people of group F, let’s say 500 people will fall for the trick of the scamsters and for this data, scamsters can demand Rs. 1 lakh or 2 lakh or the number may be vast. In this way, scamsters can rob the retail investor in multiple ways.


Multiple ways of robbing the Small investor (Retail investor)


A >> One way may be, scamsters can sell the subscription for say of Rs. 40k or 50k or other high value and investors buy them.

B >> Scamsters can sell their courses in any XYZ courses for any amount.

C >> These scamsters just rubbing the fellows for say Rs. 50 lakh or 1 lakh as these scamster are slightly ethical.

D>> some serious scamsters have no ethical values and they just sell their Penny stocks.

Basically Scamsters buy stock for say, Rs. 10 and they rig it up and take the price to let’s say Rs.200 and at Rs. 200, they will dump that share to these small investors and once scamsters sell them, stock comes to their original price of Rs. 10.

Awareness and Knowledge about the Stock Market scam is the need of the hour that must be taken seriously among retail investors. Scamsters are ruling their own laws where Regulation and Rules of the Government may not interrupt the dealing of this unethical trade and robbing the innocent investors.

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