Investor Reports $1 Million Loss in Stockal Unauthorized Trading Incident
A new investor claims a significant financial loss due to unauthorized liquidation of US stocks on the Stockal platform.
Another investor alleges a $1 million loss linked to Stockal.
Unauthorized trades led to mass liquidation of US blue-chip stocks.
Stockal denies any wrongdoing, attributing issues to potential social engineering.
In a troubling development for investors using the Stockal platform, another individual has come forward, revealing that his brother incurred a loss of approximately $1 million due to unauthorized trading activities. This incident follows a previous report detailing significant financial damages suffered by nearly 30 retail investors, who collectively lost over Rs 100 crore due to similar unauthorized stock trades.
Stockal Securities, a fintech company based in Bengaluru, allows Indian retail investors to trade in US stocks and other foreign securities. The platform, which partners with US clearing brokers like DriveWealth LLC, has faced scrutiny after reports surfaced that numerous accounts were accessed without authorization on October 15, leading to the liquidation of blue-chip stock holdings.
Among the affected investors is a senior official from a major beverage company in India, who disclosed that unauthorized trades resulted in the liquidation of his top US stock holdings, including shares of Apple, Tesla, and Amazon, totaling $335,768. The proceeds from these sales were allegedly redirected to purchase shares of Zhibao Technology Inc., which subsequently saw a drastic decline in value.
In response to the allegations, Borderless Investing, the parent company of Stockal, stated that their investigation found no evidence of a breach in their systems. They suggested that the affected accounts might have been compromised through social engineering tactics related to a separate data breach at another company. They emphasized that access to the accounts was restricted promptly after the unauthorized activity was detected.
As the situation unfolds, Stockal has denied any liability for the unauthorized trading and remains committed to assisting affected customers. The ongoing investigation aims to clarify the circumstances surrounding these unauthorized transactions and to establish accountability. Investors are advised to stay vigilant and monitor their accounts closely as more information becomes available.
