SEBI has intensified its monitoring of financial content online, removing more than 1.2 lakh misleading posts shared by unregistered financial influencers across social media platforms.
According to Tuhin Kanta Pandey, the Securities and Exchange Board of India has stepped up action against misleading investment advice and strengthened digital surveillance through artificial intelligence.
“We have removed more than 120,000 such pieces of content from social media where we found egregious behaviour violating our norms,” Pandey said while discussing the regulator’s action against unregistered investment advisers.
He clarified that SEBI rules clearly state that only registered entities are allowed to offer investment advice. “If you have to give investment advice, you have to be registered with SEBI. And being registered means you have certain do’s and don’ts,” he said.
At the same time, Pandey highlighted that individuals are free to share financial knowledge and opinions online. “People have every right to express themselves and undertake financial education… Only when you transgress that line and actually mislead investors do we step in,” he said. He also noted that social media companies have cooperated with the regulator in removing such content.
To strengthen oversight, SEBI has introduced an in-house artificial intelligence tool called Sudarshan. The system is designed to monitor digital platforms and detect potential violations in financial content.
“We are armed with our own AI tool called ‘Sudarshan,’ through which we are able to track, on a multilingual basis, audio, video and other content to pinpoint where transgressions occur,” Pandey said.
The regulator is also focusing on the growing participation of retail investors in derivatives markets. Pandey pointed out that retail activity, especially in options trading, increased significantly after the pandemic, partly driven by social media narratives promising quick profits.
To address the risks, SEBI released data showing that most retail traders faced losses in derivatives trading. The regulator also introduced statutory warnings on trading platforms, including a pop-up message stating that “9 out of 10 investors lose money” in options trading.
Pandey described the past year as “a year of reform” for SEBI and emphasised that the regulator aims to maintain balanced oversight.
“Market development is not about a sledgehammer approach but more like a surgeon’s knife,” he said, stressing the need for effective regulation while allowing market growth.
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