The victims were promised quick and substantial profits by securing pre-allotment of shares in upcoming Initial Public Offerings (IPOs).
Nearly one-third of IPO fraud investment schemes reported in Hyderabad were committed in the first two months of 2024, the Telangana police said on Friday, 1 March.
While a cumulative loss of over ₹3.91 crore in 627 cases was reported in 2023, fraudsters have got away with a staggering ₹27.40 crore in 213 cases reported in January and February alone this year.
Among those who were shortchanged was a businessman from Kukatpally in Hyderabad, who lost ₹5.98 crore after joining a WhatsApp group, “Goldman Sachs Business School”. He had invested the money in “GSIN”, an unauthorised app.
As many as four cases, including the Kukatpally one, were registered by the Hyderabad cyber crime police. The victims were promised quick and substantial profits by securing pre-allotment of shares in upcoming Initial Public Offerings (IPOs).
The victims were asked to join a WhatsApp group and then invest in Ponzi investment mobile applications.
A software engineer in Kukatpally Housing Board Colony (KPHB) lost over ₹1.03 crore after joining a WhatsApp group, “Stock Market Research Institute”, and investing in another unauthorised app “Wells Pro”. He was promised a pre-allotment of the “Konstelec” IPO through Foreign Institutional Investment (FII), the police said.
Another businessman, a resident of Bowenpally, was lured into joining the WhatsApp group, “82 Strong Stocks Academy,” investing in “Goomi.apk.” He was promised a pre-allotment of the “Mobikwik” IPO. The man is now poorer by ₹67.50 lakh.
In another case, a private firm employee in Rajendranagar lost over ₹50.61 lakh.
The police said the scamsters operated through online platforms such as WhatsApp, Telegram, Instagram, Twitter, and others.
After establishing contact with a potential victim, the fraudsters promised them lucrative IPO investment opportunities, “facilitated” by institutional channels such as Foreign Portfolio Investors, the investigators said.
Once victims fell into their trap, they were directed to download fake trading applications designed to capture personal and financial information.
Subsequently, victims were deceived into transferring funds to designated bank accounts controlled by fraudsters.
The fake apps often displayed fabricated investment portfolios, convincing victims to invest more. However, withdrawal requests for supposed profits were denied, resulting in substantial financial losses.
The police appealed to the investors to be cautious, and vigilant when contacted with investment opportunities, especially through messaging and social media platforms.
The investors must verify the legitimacy of offers. They should also refrain from downloading suspicious apps and conduct thorough research of the apps before investing, the police said.
