Incidents of stock market fraud through social media are increasing day by day.Using the names of well-known market analysts and institutions, fraud rings are luring investors with promises of massive profits—often hundreds of times their investment. Despite repeated warnings from the regulatory body, the Bangladesh Securities and Exchange Commission (BSEC) and the Dhaka Stock Exchange (DSE), these fraudulent activities continue unabated.

The fraudsters primarily use platforms like Facebook to run flashy advertisements and then add interested investors to WhatsApp or Telegram groups. Inside these groups, they pressure individuals to invest using fake mobile applications. One fraud group has even announced the launch of a new app, further demonstrating how undeterred they are in continuing their operations.

Failing to stop the scams, BSEC has sought help from the National Telecommunication Monitoring Centre (NTMC), an intelligence agency under the Ministry of Home Affairs responsible for monitoring electronic communications in the country. However, it remains unclear whether NTMC has taken any concrete action yet. As a result, the fraudsters are still operating freely.

Investigations reveal that the fraudsters use sensitive and trusted symbols to build credibility—such as the logos and images of the stock exchange, various merchant banks, and brokerage houses.

Although this type of scam is relatively new in Bangladesh, it has already caused significant financial losses in other countries. According to an FBI report, in 2023 alone, frauds like this cost victims billions of dollars in the United States. In India, ₹5 billion was stolen in a similar manner in 2014. The UK, Singapore, and Nigeria have also seen comparable scams.

Using artificial intelligence (AI), the fraudsters generate hundreds of ads, offering returns of 300% to 500% on investments. Initially, they allow investors to withdraw small amounts of profit to gain their trust. Then they pressure them to invest larger amounts with offers like “Only for today,” “Bonus for top investors,” or “VIP AI Model.”

When investors try to withdraw large sums, they are asked to pay additional charges such as “tax,” “verification fees,” or “wallet upgrade fees.” After collecting the money, the fraudsters disappear, usually transferring the funds via cryptocurrency or bank transfers.

BSEC had identified these scams several months ago. In response, DSE held a press conference and issued warnings. However, these efforts have not been effective. A BSEC official, speaking anonymously, said, “We don’t have the technology to prevent this kind of fraud.”

BSEC’s Market Intelligence Department has written to NTMC, warning them about the use of AI in fraud and requesting that a specific WhatsApp group be shut down. However, the fraudsters operate through countless WhatsApp groups and fake accounts, making it impossible to eliminate the threat by closing just one group.

Experts emphasize the need for a tech-driven, coordinated approach to effectively tackle this growing problem.