Roughly a week after it was reported that some demat accounts with Zerodha were hacked, the low-cost broking firm's founder took to Twitter to clarify that the number of accounts affected were minimal, and that his company will soon introduce a safety tool for investors.
The Mumbai police has arrested five persons in connection with the hacking of demat accounts and since then, there has been furore over the safety of other demat accounts.
Kamath has conceded that their current way of requesting a temporary one-time password is insufficient to protect the accounts.
Thanks to @AnilSinghvi_ & @ZeeBusiness for highlighting the cybercrime risks when trading the markets. Cybercrime has gone up across banking to broking to social media. We must be extra vigilant.Here's everything we're doing at @zerodhaonline. 1/7
— Nithin Kamath (@Nithin0dha) July 22, 2022
In a Twitter thread on July 22, Kamath had said hacking accounts will become difficult from September 30, when one-time passwords, time-based one-time passwords (TOTPs) and biometric logins will become mandatory.
TOTPs are OTPs that are valid for a short period of time. If not used in that time, the user will have to request another TOTP, and they can make only a limited number of requests.
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On Tuesday, Kamath tweeted, "We are soon launching a tool that disallows trades in illiquid options far away from theoretical price + a Kill Switch option to block orders in all penny stocks similar to F&O. Address the root cause of most hacking attempts."
An illiquid option is an options contract that cannot be easily sold or converted to cash quickly at the prevailing market price.
There has been some noise about the hacking incidents at Zerodha. Here is some data:Out of the ~65lk customers who traded with us last year, we have ~100 complaints of fraud. ~ 80 where login details were shared willingly & ~20 where email was hacked (all Rediffmail IDs). 1/4
— Nithin Kamath (@Nithin0dha) August 2, 2022
Further, the Economic Times reported Kamath as saying that since all email hacking cases were from users who use Rediffmail, Zerodha has blocked Rediff IDs on trading accounts and they also don't send password resets to Rediff email IDs.
In today's Twitter thread, Kamath said the number of affected accounts was low. "There has been some noise about the hacking incidents at Zerodha. Here is some data: Out of the ~65lk customers who traded with us last year, we have ~100 complaints of fraud. ~ 80 where login details were shared willingly & ~20 where email was hacked (all Rediffmail IDs),” Kamath tweeted.
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