SECP warns against fraudulent online trading platforms investment scheme

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) cautions the general public against investing through unlicensed online trading platforms, websites and mobile applications offering unrealistic returns on investment in stocks or other financial products traded in local or international securities markets.

The SECP has received complaints from licensed securities brokers and investors against platforms such as Interactive Brokers Group (IBKR), IGIL Securities Country, BMA Capital No108/BMAC Global Pro, WTIC World Top Investor Competition, Aviva Securities, among others, says a press release.

Such fraudulent platforms are being promoted via social media enticing people public with deceptive claims of high returns and minimal risk, the SECP said. They solicit investments through unverified mobile or web-based applications, using links that appear to represent legitimate trading platforms.

In order to appear credible, they frequently misuse the names, logos and images of reputable companies, professionals and even regulatory authorities. These platforms display fake dashboards showing false account balances and profit figures, while in reality no actual trading or investment is taking place. Initially, investors may be allowed to withdraw small profits to build trust; however, this is typically followed by pressure to invest larger amounts.

Once additional funds are deposited or if an investor refuses to invest further or attempts to withdraw remaining funds access is suddenly blocked.In Pakistan, trading in securities of listed companies and commodities can only be carried out through SECP-licensed securities and futures market brokers. The lists of authorized brokers can be accessed through the websites of the Pakistan Stock Exchange and Pakistan Mercantile Exchange Limited.

Any such platforms and associated bank accounts identified by the SECP as being used by fraudsters are being promptly reported to the FIA, PTA and State Bank of Pakistan (SBP) for appropriate action.

People are urged to refrain from depositing or investing funds with any unlicensed entities or individuals offering unauthorized trading or investment services, the statement read.Before committing to any financial arrangement, investors must confirm the legitimacy of the platform or person involved.