Nearly 30 Indian retail investors have come forward alleging unauthorized transactions involving their US stock portfolios held through the fintech platform Stockal Securities. Preliminary reports indicate these investors collectively face losses exceeding ₹100 crore.
The allegations center on transactions that reportedly occurred on October 15, 2026. Shares of prominent American companies, including Apple, Tesla, Amazon, Alphabet, Nvidia, and AMD, were allegedly liquidated without the explicit approval of the investors. The proceeds from these sales were then reportedly used to purchase less-known, obscure stocks that subsequently experienced sharp price declines.
Details of Alleged Unauthorized Sales
One affected investor, a senior executive at a leading Indian beverage company, reported that his 10 major US stock holdings, valued at $335,768, were sold without authorization. The funds were then allegedly used to acquire 300,000 shares of the Chinese company Zhibao Technology Inc. (ZBAO) at an average price of $1.05. ZBAO's stock subsequently plummeted by nearly 60%, closing at $0.42 on October 23, resulting in claimed losses of approximately $450,000, equivalent to ₹4.26 crore for this individual. The investor also noted a suspicious absence of routine trade confirmation emails for these specific transactions.
Another investor reported an even larger scale of liquidation, with securities worth $3.1 million (approximately ₹29 crore) sold within a mere two minutes. The proceeds were allegedly reinvested into 3.05 million shares of a thinly traded stock within 15 minutes. This investor claims neither the original portfolio nor the incurred losses have been restored.
Stockal and DriveWealth Dispute Responsibility
In response to the serious allegations, Stockal informed Moneycontrol that the incident remains under active investigation. Their preliminary assessment suggests that compromised email credentials, possibly obtained through phishing or social engineering tactics, might have facilitated the unauthorized access. However, Stockal maintains that its internal investigation has not uncovered any evidence of a breach within its own platform.
DriveWealth, the US clearing and custody broker for Stockal, has disputed responsibility for the incident. In an October 30 communication, DriveWealth asserted that any unauthorized access occurred via Stockal's interface, not through its own systems. DriveWealth further alleged that instructions from Stockal caused delays in implementing certain corrective measures. These conflicting claims mean that responsibility for the transactions has not yet been independently established.
HDFC Securities Connection and Broader Implications
Many of the affected investors had initially accessed Stockal's services through a global investing partnership with HDFC Securities, which commenced in 2019 but concluded in July 2024. An FIR has been registered in Bengaluru, naming several entities including HDFC Securities, though Moneycontrol has clarified that HDFC Securities is not named as an accused party.
The gravity of the situation is underscored by at least one investor approaching both the Securities and Exchange Board of India (SEBI) and the US Securities and Exchange Commission (SEC) for intervention. This episode highlights significant concerns regarding investor protection, the verification processes for cross-border transactions, and accountability within digital investment platforms.