The market watchdog further said that fraudsters are sending fake notices, forging the regulator’s letterhead and requesting payment for outstanding STT amount.
The Securities and Exchange Board of India (SEBI) said in a statement, “SEBI has noticed that certain fraudsters have sent notices requiring compliance with the Securities Transaction Tax (STT) under the Finance Act, 2004.”
The regulator said investors are being made aware that this notice has not been issued by SEBI.
“It is being stated that STT is levied on every purchase and sale transaction of securities executed on stock exchanges, and the tax is collected by the broker,” he added.
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SEBI clarified that it does not issue notices for remittance of STT amounts nor does it coordinate with the Reserve Bank of India (RBI) on the same.
The regulator also warned against cases of fraudsters impersonating SEBI officials or misusing the market watchdog’s logo, seal or letterhead to cheat investors.
Such persons are sending fake communications, emails or notices in the name of SEBI, requesting the wrongful investors to transfer money to these fake accounts, thereby causing financial loss, according to the release.
“…the public is requested to exercise caution and verify the authenticity of letters/notices seeking information or payment on behalf of SEBI,” the release said.
In a separate release on Thursday, Sebi warned investors against fraudsters posing as account handlers or fund managers who promise risk-free returns in the stock market.
These entities claim to provide portfolio or account handling services, often demanding access to investors’ trading account credentials while charging a share of profits, Sebi said. However, the loss has been fully borne by investors, the regulator said.
The regulator explained that such persons are not SEBI-registered and operate outside its purview. It requests investors not to believe the claims of such account handlers/fraudsters and refrain from sharing their account credentials with anyone.
“Investors are advised to verify the entity’s registration status with SEBI before investing and transact only through authorized trading apps of SEBI-registered intermediaries,” the regulator said.
The market watchdog said the advisory is aimed at protecting investors from fraud and scams perpetrated by unregulated entities.
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