Stock market scam: SEBI warns investors against fraudulent account handling services

The Securities and Exchange Board of India (SEBI) has warned investors about the rising threat of stock market scams carried out through so-called “account handling” services.

According to SEBI’s Press Release No. 14/2026, certain individuals, referred to as account handlers or fraudsters, are offering services that claim to help investors earn risk-free profits in their demat or trading accounts.

These fraudsters often present themselves as experts in account handling services, PMS service providers, or professional fund managers. They typically demand a minimum capital investment and charge a percentage of the investor’s profits.

“These fraudsters exploit investors by showcasing trades they claim to have executed successfully for others,” said the market regulator. “Investors must understand that losses incurred in such trades are borne entirely by them, while the fraudsters share only the profits, if any.”

SEBI further highlighted that these fraudsters require investors to share their trading account credentials, effectively giving them control over the accounts. “Sharing account credentials with anyone can lead to complete financial loss. Investors should never trust claims of guaranteed profits,” the regulator emphasised.

Disclaimer: This article is written purely for informational purposes and should not be considered investment advice from Upstox. Investors should do their own research or consult a registered financial advisor before making investment decisions.