New Delhi, Feb 27: Securities and Exchange Board of India (SEBI) on Thursday cautioned investors against fake notices demanding payment of Securities Transaction Tax (STT), warning that fraudsters are misusing its letterhead to dupe the public.
SEBI said scammers are sending false notices claiming investors have pending STT dues under the Finance Act, 2004, and are invoking provisions of the Sebi Act, 1992, to demand payment. The regulator clarified that it never sends notices to investors asking them to pay STT and does not coordinate with the Reserve Bank of India (RBI) for tax collection.
It explained that STT is automatically levied on stock exchange transactions and collected directly by brokers at the time of trade. SEBI also warned that fraudsters are impersonating its officials using fake email IDs resembling official addresses to make the communication appear authentic.
Earlier this week, the National Stock Exchange (NSE) issued a similar advisory after detecting fake communications using SEBI’s letterhead to demand STT payments.
