Investment advice through SMS can be cheese in a mousetrap

Aug 26 2013, 08:38 IST
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SummaryIf you get SMSes offering quick and high returns, verify if the sender is registered with Sebi.

only intermediaries registered with Sebi, said Rajeev Kumar Agarwal, whole-time member of Sebi in the order which further stated that the bank account details provided on the website of the entities received cash deposits from various parts of the country against the services they were offering.

While Sebi has cautioned and is taking action against such individuals involved in fraud, investors need to keep their greed aside and take informed investment decisions.

When it comes to physical health individuals generally do their due diligence to figure out a good, qualified doctor, the same practice should be adopted while picking a doctor for your financial health.

Do some basic checks before you give someone your money to manage or seek someones advice.

Is the entity registered with the regulator? Are the returns being promised, realistic? Check on where your funds are being parked. Seek the help of a professional.

Investors can also call on Sebis toll free helpline service number 1800 266 7575 or 1800 22 7575 for queries relating to securities market such as query on status of a company and registered intermediaries with Sebi, etc.

A basic check will help you take a more informed decision on your planned investment and thereby safeguard yourself against fraudulent practices prevalent in the market. A large number of investors have lost their money chasing high returns in quick time through illegitimate schemes.

According to an estimate by Sebi, illegally run collective investment schemes have mobilised over Rs 10,000 crore from investors across the country. Also investments worth Rs 5,500 crore of around 13,000 investors are stuck for settlement with National Spot Exchange Limited as they too were chasing high assured returns.

Be prudent in your investment behaviour and realistic in your return expectation.

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