Borderless, the parent company of Stockal Securities, said on Wednesday, November 4, that US clearing broker DriveWealth had notified it about unauthorised trading activity in 13 customer accounts, amid allegations by nearly 30 retail investors that they lost more than Rs 100 crore on the Bengaluru-based platform, IANS reported. The Rs 100-crore figure is an allegation made by investors; no regulator has assessed or confirmed the losses so far.

Source: IANS

The SEBI-registered platform lets Indian retail investors buy US stocks and ETFs through DriveWealth. Borderless said an unauthorised third party appears to have accessed 26 accounts using valid login credentials, and that in 13 accounts large-cap holdings were sold to buy microcap securities, with no funds withdrawn.

Source: IANS

"Our investigation has found no evidence of a breach or compromise of the Borderless platform. We have engaged independent cybersecurity specialists. We believe affected account holders may have been victims of social engineering," Borderless said, adding that its assistance to customers does not constitute an admission of liability.

Source: IANS

According to the Moneycontrol investigation published on November 3, investors said their accounts were accessed without permission on October 15 and holdings in companies including Apple, Nvidia, Amazon, Tesla, Alphabet and AMD were liquidated, with the proceeds used to buy the thinly traded Chinese stock Zhibao Technology Inc. (ZBAO). A police complaint has been registered in Bengaluru, and at least one investor has complained to SEBI and approached the US Securities and Exchange Commission, Moneycontrol reported.

Source: FinanceFeeds, reporting Moneycontrol

HDFC Securities separately clarified in an exchange filing that it is not named among the accused in the FIR. "We have seen the recent report by Moneycontrol referring to Stockal and the FIR. To set out the facts, the report itself notes that HDFC Securities is not named among the accused in the FIR," the brokerage said. It said its operational partnership with Stockal for globalinvesting.in, launched in 2019, ended in 2024.

Source: IANS

DriveWealth, in a letter dated October 30 to an affected investor, said the unauthorised access occurred in the interface with Stockal and that security lapses are owned by Stockal. "The unauthorized activity did not initiate at DriveWealth. DriveWealth is not at fault," the letter said, according to IANS. The three companies' accounts of where the failure occurred therefore conflict, and the matter remains under investigation.

Source: IANS