Indian investors suffer loss of over ₹100 crore due to sale of US shares

Indian retail investors investing in the US stock market have suffered a massive financial loss of over ₹100 crore. In this scam, major US stocks such as Apple, Tesla, and Nvidia held in their portfolios were sold without obtaining permission from the investors. The fintech platform Stoxl Securities has been accused of being at fault in this incident.

According to today's report, 30 Indian retail investors have alleged that all shares from their US stock portfolios were sold without their knowledge through Stoxl Securities. According to a Moneycontrol report, these alleged transactions took place on 15 October, 2026. During this period, shares of large US companies such as Apple, Tesla, Amazon, Alphabet, Nvidia, and AMD held in the investors' portfolios were liquidated.

The most significant change observed in these transactions was that after selling the investors' favourite shares, the money was used to purchase shares of companies that were not well-known and whose prices were rapidly declining. This incident has raised serious questions regarding account security and has sparked a dispute between Stoxl and its US clearing broker, Drivewealth, regarding transaction responsibility.

One affected investor, who is a senior executive at a large Indian beverage company, told Moneycontrol that 10 large US stocks worth $335,768 were sold without any permission. According to the report, the proceeds from this sale were used to purchase 3,00,000 shares of a Chinese company, Zibao Technology Inc. (ZBAO), at an average price of $1.05. Subsequently, on 23 October, the price of ZBAO fell by almost 60% and closed at $0.42. This investor has claimed a loss of approximately $450,000, which is equivalent to ₹4.26 crore in Indian currency. He further alleged that routine trade confirmation emails were not even sent for these unauthorised transactions.

Another investor, highlighting the gravity of the incident, stated that securities worth $3.1 million, i.e., approximately ₹29 crore, were liquidated within just two minutes. The report further stated that this amount was used to purchase 30.5 lakh shares of a low-trading stock within 15 minutes. This investor claimed that their portfolio and the loss incurred have not yet been rectified.

Regarding these serious allegations, Stoxl told Moneycontrol that the investigation into the incident is still ongoing. Preliminary investigations have revealed that unauthorised access may have been obtained through email credentials acquired via phishing or social engineering. However, Stoxl has clarified that their investigation has found no evidence of a security breach within their own platform.

On the other hand, Drivewealth, the company providing clearing and custody services, has refused to take responsibility for this incident. In a communication on 30 October, Drivewealth claimed that the unauthorised access occurred through Stoxl's interface, not through their own system. Drivewealth also accused Stoxl of delaying certain remedial measures due to Stoxl's instructions. These allegations are disputed and responsibility has not been determined so far.

The affected investors had used Stoxl through HDFC Securities' Global Investing Partnership, which commenced in 2019. This operational partnership ended in July 2024. The FIR registered in Bengaluru includes the names of several companies, including HDFC Securities, although Moneycontrol has clarified that the brokerage company has not been made an accused. One investor has also contacted SEBI and the US Securities and Exchange Commission. This incident has highlighted concerns regarding investor security, transaction verification, and liability on cross-border investment platforms.

In a historical context, HDFC Securities has been one of India's leading brokerage companies providing various financial services to investors. Over the years, the company has entered into various partnerships to invest in global markets, one of which was the Global Investing Partnership that concluded in 2024.