Biggest Indian stock market scams - All covered - Learning sharks-Share Market Institute

For a long time, the stock market has been one of the public’s preferred investing options. It has made many people wealthy by returning high returns on their investments. However, there have been instances where fraudsters duped investors and misled the market, creating irreversible and irreplaceable damage, and those stories will be remembered for years to come.

In this post, we’ll take a look at several fraudulent acts that had such a big impact that they shook the stock market when they were found.

This had a negative impact on the system’s normal operation as well as the finances of the investors, lowering the overall worth of the system.

Scam	Nature of Industry	Fraud Perpetrators	Year	Modus Operandi
Harshad Mehta scam	Capital market	Harshad Mehta	1992	Harshad Mehta used bank receipts extensively to raise funds from the banks. Subsequently invested the same in the stocks listed in the BSE to inflate the stock prices artificially
CRB scam	Capital Market	C R Bhansali	1996	Raised public money through various instruments like Fixed Deposits, Mutual Funds via non-existent firms used the same to rig share prices in the stock market
Ketan Parekh scam	Capital Market	Ketan Parekh	2001	Procured funds from banks and other financial institutions.Used those funds to inflate the stock prices artificially through circular trading
UTI scam	Mutual Fund	Chairman, Executive Director, Stock Broker	2001	The mismanagement of continuously investing in high-risk stocks and share heavy investments in Ketan Parekh’s K-10 shares
Satyam Scam	IT Company	Auditor, Director, Managers	2009	The top management of the software company manipulated the accounts to show inflated sales, profits and margins from 2003 to 2008Overstated the assets false disclosures
Sahara scam	NBFC	Subrata Roy	2009	Sahara Housing Investment Corp. Ltd. (SHICL), issued Optional Fully Convertible Debentures (OFCD) and illegally collected investor money circumventing the provisions of SEBI
Saradha Chit Fund scam	Ponzi scheme	Sudipta Sen	2013	The Ponzi scheme run by Saradha Group collected money from low-income investors by issuing redeemable bonds and secured debentures, promising incredibly high profits from reasonable investments. Embezzled the money of the investors and defaulted on repayments
NSEL* scam*NSEL, a company that provided an electronic platform to farmers and traders for spot trading in farm products and bullion among others	commodity market	CEO, Promoters	2013	The commodities that were traded were not found in the warehousesExcessive short selling and false reporting to exchange default on a payment to investors
PACL scam	Ponzi scheme	MD, Promoters, Directors	2014	The Ponzi land scheme run by PACL Ltd. duped investors in the name of assured returns from selling non-existent landsSiphoned the collected money and defaulted on re-payment
Co-location scam	Capital Market	Officials of NSE, Brokers	2015	Selected players allegedly obtained market price information ahead of the rest of the market through a co-location facility