Rekha is retired from a government authority, the kind of careful saver who keeps her money where she can understand it. Rekha did not understand the share market, and she never pretended otherwise.
“Mujhe knowledge nahi hai is baare mein, aap please mat karo”, I don’t know about this, please don’t do it. She said it more than once.
By the end, a SEBI-registered broker had traded her account into a ₹16 lakh hole on roughly ₹10.4 lakh of equity she had deposited.
The heart of this case is not a clever scheme. It is a simple, ugly fact: she said no, repeatedly, and they traded anyway.
How Sub-Brokers Bypass Client OTPs and Force Unauthorized Trades
It began with someone she trusted. A relative who worked at the broker opened her demat account and put some shares into it.
She went along with that much, “unke kehne se shares le liye, kabhi na kabhi badh hi jaayenge”, they’re family, the shares will rise someday, she didn’t think hard about it.
Then a sub-broker took the account in hand, and the pressure started. They wanted to run trades. She kept refusing.
When trades needed authorisation, they asked for her OTP, and she declined that too:
“Maine mana kiya, mere bas ka nahi hai, maine kabhi kiya nahi, aata bhi nahi.”
I refused; this isn’t in my hands; I’ve never done it; I don’t even know how.
It did not stop the trading, and it did not stop the calls. After losses piled up, one of their people changed tack:
“Dekho, aapke relative ne loss kara diya, ab main profit karaaunga, aap aa jao.”
Your relative lost it; now I’ll make you a profit; just come. She had had enough. She abused them and begged them to leave her alone:
“Mere peeche kyun pade ho, mera peecha chhod do.”
The account kept moving regardless, generating brokerage and losses, until ₹16 lakh was gone. She filed a complaint against account handling on SCORES in January, but without proper follow-through it went nowhere.
Major Violations By Stockbroker That Lead to ₹16 Lakh Loss
Strip away the family angle and the pressure, and what remains is a stack of specific breaches.
1. Unauthorised trading is the central violation
A broker may act only on the client’s instructions. The Code of Conduct in the SEBI (Stock Brokers) Regulations, 1992 requires faithful execution of the client’s orders, high standards of integrity, and due skill, care and diligence.
Trading an account whose holder is actively refusing, and never giving informed, per-trade consent, is unauthorised trading.
The very fact that they kept asking for her OTP proves they knew authorisation was required; working around her refusals does not supply that authorisation, it confirms its absence.
2. Churning a client who never wanted to trade
A retiree with no market activity of her own does not generate turnover by herself.
Trades pushed onto her, throwing off brokerage while the capital eroded, are the textbook pattern the Code of Conduct’s bar on inducing trades for brokerage exists to stop.
3. Suitability thrown out entirely
Pushing options and active trading on a retiree who said, in plain words, that she had no knowledge and did not want to participate is the opposite of due care.
“Aap aa jao, main profit karaaunga” is not advice; it is an assurance of returns used to override a refusal, something no registered intermediary may offer.
4. The firm cannot hide behind its people
The account was opened by a relative employed at the broker, and a sub-broker / authorised person ran it. A registered firm is accountable for the conduct of its own employees and authorised persons. “That was just one of our staff” is not a defence; under the regulations the firm answers for them.
What makes all of this provable is the thing she may not realise she is holding. Her refusals, on recorded calls, in messages telling them to stop, in a grievance she had already filed, are not background noise.
In an unauthorised-trading case, everything turns on consent, and a documented refusal is the cleanest possible evidence that consent was never there. The contract notes then show the trades that happened in spite of it.
What Traders Can Learn From This Case
Most people who are traded against their wishes feel they have no case because “the trades are in my name.” The truth runs the other way.
Your “no” is the strongest evidence you own.
Every time you told them to stop, on a call, on WhatsApp, in a complaint, you created proof that the trading was never authorised.
Unauthorised trading is not defined by whether a loss occurred; it is defined by the absence of your consent, and a saver who repeatedly refused has that absence on record.
The refusal she thought made her helpless is exactly what makes the case strong.
How to File a SEBI Complaint and Recover Your Money
Step 1: Freeze Your Proof
Immediately preserve every call recording, WhatsApp message, and SMS where you told the broker to stop.
In an unauthorized trading case, your documented refusal is your most powerful asset. Secure your remaining capital by changing your trading passwords and revoking any active OTP access.
Step 2: Send a Formal Demand
Email the stockbroker’s official compliance officer. State clearly that the broker traded without your consent despite your explicit, recorded refusals.
Demand a complete reversal of the unauthorized trades and a refund of the eroded capital and unfair brokerage fees.
Step 3: File a complaint in SCORES
If the broker ignores your request or rejects your claim within 30 days, then you should escalate the matter by filing an official complaint on the SEBI SCORES portal.
After that, upload your contract notes along with call recordings or messages that clearly show you had refused, either before the trade or during the transaction.
Step 4: Raise a Complaint in SMART ODR
If the SCORES resolution is unsatisfactory, escalate your case to the SMART ODR platform.
This online dispute resolution portal connects you with independent mediators and arbitrators who review the evidence objectively to resolve stock market disputes efficiently.
Step 5: File for Stock Market Arbitration
For severe financial damage, such as capital wiped out by unauthorized options churning, take the matter to exchange-level arbitration (BSE/NSE).
A legally binding arbitration panel will evaluate the lack of client consent and can mandate the brokerage firm to compensate your losses.
Need Help Navigating Your Recovery Case?
Many retail investors feel completely helpless because the unauthorized trades are executed in their own name and demat account. You do not have to fight this complex system alone.
We help exploited savers cut through the broker’s excuses. A registered firm cannot hide behind the rogue actions of a sub-broker or a relative employed with them, they are legally accountable for the conduct of their staff.
Our team will audit your account statements, map out the exact SEBI Code of Conduct violations, match them against your documented refusals, and build an airtight case to maximize your chances of recovery.
If a stockbroker traded without your consent and ignored your pleas to stop, reach out to us today to evaluate your options.
Conclusion
An execution of trades against your clear refusal is a blatant regulatory breach, not a market risk you are forced to accept.
Real SEBI-registered intermediaries must operate with absolute integrity and strictly execute only the orders you authorize.
A broker cannot bypass your consent, churn your account for brokerage, or push high-risk options trading on a conservative saver.
Do not let them convince you that a lack of compliance is your fault.
Gather your call recordings, preserve your messages, and file your official complaints immediately to reclaim what is rightfully yours.
FAQ
1. Can a broker trade my account using my OTP or without my consent?
No. A broker must act on your instructions. Needing your OTP shows authorisation is required, trading around your refusal is unauthorised trading.
2. I kept refusing but they traded anyway. Does that help my case?
It is central to it. Recorded calls or messages showing you refused are direct evidence that the trades lacked your consent.
3. The account was opened by a relative who worked at the broker, does the firm escape blame?
No. A registered broker is responsible for the conduct of its employees and authorised persons; it cannot disown what they did in your account.
