Stockal fraud: ₹100 crore loss alleged as Borderless, HDFC Securities issue clarifications
Synopsis
Nearly 30 retail investors allegedly lost over ₹100 crore after their US stock holdings — including Apple, Tesla, and Nvidia — were liquidated and funnelled into a Chinese microcap that then crashed 60%. Borderless blames social engineering; DriveWealth points the finger back at Stockal; HDFC Securities says its partnership ended in 2024. The case is now with both SEBI and the US SEC.
Key Takeaways
Borderless , parent of Stockal Securities , confirmed unauthorised trading in 13 customer accounts after 26 were accessed via valid credentials.
Nearly 30 retail investors allegedly lost more than ₹100 crore ; holdings in Apple, Tesla, Amazon, Alphabet, Nvidia and AMD were liquidated.
Proceeds were used to buy Chinese microcap Zhibao Technology Inc. (ZBAO) , which subsequently fell 60% .
DriveWealth said in a 30 October letter that the breach did not originate on its platform and blamed Stockal for security lapses.
HDFC Securities clarified it is not named in the FIR ; its partnership with Stockal on globalinvesting.in ended in 2024 .
Affected investors have approached both SEBI and the US SEC ; investigation is ongoing.
Borderless — parent company of Stockal Securities — on 4 November 2026 said that US clearing broker DriveWealth LLC had notified it of unauthorised trading activity in 13 customer accounts, amid allegations that nearly 30 retail investors lost more than ₹100 crore on the Bengaluru-based fintech platform. Separately, domestic brokerage HDFC Securities clarified that it is not named as an accused in the First Information Report (FIR) filed in connection with the alleged fraud.
What Borderless Said
Borderless, which operates Stockal — a Securities and Exchange Board of India (SEBI)-registered platform that lets retail investors buy US stocks and ETFs through DriveWealth — said an unauthorised third party appears to have accessed 26 accounts using valid login credentials. In 13 of those accounts, large-cap holdings were sold and the proceeds were used to purchase microcap securities, with no funds reportedly withdrawn.
'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 in a statement, adding that any assistance it offers 'does not constitute admission of liability.'
HDFC Securities Distances Itself from FIR
In an exchange filing, HDFC Securities stated: '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 noted that its operational partnership with Stockal for the platform globalinvesting.in — launched in 2019 — was wound down in 2024. It stressed that customer trust and regulatory compliance remain central to its operations, and said it would cooperate with regulators as required.
What Investors Lost and How
According to reports, nearly 30 investors experienced unauthorised access in October 2026. Holdings in blue-chip US stocks including Apple, Tesla, Amazon, Alphabet, Nvidia, and AMD were allegedly liquidated, and the proceeds were used to buy thinly traded Chinese stock Zhibao Technology Inc. (ZBAO), which subsequently fell approximately 60% — amplifying investor losses.
DriveWealth Points to Stockal
In a letter dated 30 October to an affected investor, DriveWealth maintained that the unauthorised activity did not originate on its platform. 'The unauthorized activity did not initiate at DriveWealth. DriveWealth is not at fault,' the letter reportedly stated, adding that accounts were frozen on Stockal's instruction. The company said security lapses are owned by Stockal.
Regulatory Action and What Comes Next
Affected investors have approached both SEBI and the US Securities and Exchange Commission (SEC), and an investigation into how accounts were accessed and how unauthorised trades were executed remains ongoing. This case raises broader questions about the security frameworks of cross-border investing platforms, and comes at a time when retail participation in US equities via Indian fintech apps has expanded rapidly. Regulators and investors alike will be watching for findings on whether social engineering alone explains the breach — or whether platform-level gaps played a role.
Point of View
But it cannot be accepted uncritically when 26 accounts were compromised within what appears to be a narrow window and the proceeds all flowed into a single illiquid Chinese stock. The ZBAO trade pattern — large-cap liquidation into a thinly traded microcap that then crashed — is a known pump-and-dump adjacency structure, and investigators should determine whether there is a coordinated actor on the other side. SEBI's response will also be a test: cross-border retail investing has grown fast, and this case exposes a regulatory gap in accountability between Indian platforms and their foreign clearing intermediaries.
NationPress
4 Nov 2026
Frequently Asked Questions
What happened in the Stockal fraud case?
Nearly 30 retail investors allegedly lost more than ₹100 crore after their US stock holdings were sold without authorisation on the Stockal platform in October 2026. The proceeds were used to buy Chinese microcap Zhibao Technology Inc. (ZBAO), which later fell approximately 60%, deepening investor losses.
What did Borderless say about the breach?
Borderless, Stockal's parent company, said its own platform was not compromised and that an unauthorised third party accessed 26 accounts using valid login credentials. It attributed the incident to probable social engineering of affected customers and said it has engaged independent cybersecurity specialists.
Is HDFC Securities involved in the Stockal FIR?
No. HDFC Securities clarified in an exchange filing that it is not named among the accused in the FIR. The brokerage noted that its operational partnership with Stockal for globalinvesting.in, which launched in 2019, was ended in 2024.
What did DriveWealth say about its role?
DriveWealth, in a letter dated 30 October to an affected investor, stated that the unauthorised activity did not originate on its platform and that security lapses are owned by Stockal. It confirmed that accounts were frozen on Stockal's instruction.
What action are investors and regulators taking?
Affected investors have filed complaints with both SEBI and the US Securities and Exchange Commission (SEC). Investigations into how accounts were accessed and how the unauthorised trades were executed are ongoing, with no final findings published as yet.
