From Oranges To Offshore: How ‘Trade Dost’ Lured Investors Into A Dabba Trading Maze With A Front-Page Ad
While dabba trading is completely illegal and the investors who face losses cannot take their issues to SEBI, this particular entity ran like a registered company, sources told NDTV Profit.
The multi-city scam of a dabba trading firm has caught the eye of authorities after it gave a front page advertisement in the Hindi Daily Navbharat on July 13, prompting market regulator Securities and Exchange Board of India and the leading bourse National Stock Exchange to caution investors. But what remains interesting is the behind-the-scene setup of this scheme.
As per the people privy to the matter, the scheme by 'Trade Dost' or 'Close Friend Traders' was first operated from the city of oranges, Nagpur. As the unregulated business picked up, the base shifted to Delhi and then the founder shifted to UAE along with his business partner, one of the people quoted above mentioned.
While dabba trading is completely illegal and the investors who face losses cannot take their issues to SEBI, this particular entity ran like a registered company, NDTV Profit was further told. The setup was such, that over twenty employees and brokers based out of Delhi and Nagpur are associated with it, and this also includes a functioning marketing team, sources said.
While some of these staffers were hired on the pretext of getting a formal job in a legally valid vertical, they were later shifted to illegal trading work, and some even faced salary issues, Profit was further informed.
This particular entity lured customers through mobile SMSs, Telegram Groups, WhatsApp demo calls, and YouTube channels on the pretext of high returns and promises to open an account without any documentation. However, people privy to the issue told Profit that since most of the F&O trades lead to losses for investors, those booking profits faced a different issue.
In case an investor trading with the firm booked high profits, they would be able to either withdraw their amount partially or they would even get shunned from the platform, sources said.
Currently, the regulator has mentioned that a complaint against the firm and the entities involved has been filed with the cyber police and the Hindi daily is set to face the scrutiny of the advertising authority.
Profit's Campaign
The firm, operating under the brand name Trade Dost, claimed to offer intraday margins up to 500 times and carry-forward margins of 60 times. These features—clearly outside the regulatory framework—caught Profit’s attention.
Hence, the team decided to give the entities involved a call in order to get a bigger picture.
On the call, the firm's representative, identifying himself as "Raghav", openly admitted that they were not registered with SEBI. When questioned about the legality of offering financial advice and services without regulatory approval, he showed little concern.
When asked about their location, he confirmed the operation was based in Shahdara, Delhi, and that they were using UAE-based phone numbers. He abruptly ended the conversation when pressed further, saying, “You do your business, I’ll do mine.”
The story was published the following morning. Soon after, India's leading bourse NSE issued an investor caution circular, warning the public not to engage with unregistered advisory firms making such offers. The exchange also mentioned that Trading Dost is not a platform that investors should associate with.
Following this, NDTV Profit reached out again to the same contact number. The second conversation revealed a dramatic shift in tone— the unregistered firm's representative now contradicted his earlier statements and attempted to downplay the firm’s offerings.
One of the earlier numbers had been deactivated for incoming calls. But on the second line, Mr. Raghav was once again reachable, though this time his narrative had changed completely.
While this may seem like an isolated case of overzealous, unregulated financial activity, it is far from unique. Across India, thousands of such dabba trading entities thrive, running operations through Telegram groups, YouTube channels, WhatsApp broadcasts, and unsolicited SMS campaigns.
These unregistered firms not only bypass regulatory oversight but also expose investors to massive risks, including financial loss, legal consequences, and identity theft.
SEBI registration is mandatory for anyone offering financial advisory services or operating trading platforms in India. If it sounds too good to be true—it probably is.
