Market regulator Securities and Exchange Board of India (SEBI) has removed more than 120,000 misleading social media posts by unregistered financial influencers and is using artificial intelligence tools to monitor violations in the digital space, chairman Tuhin Kanta Pandey has said.
Speaking
to news agency ANI, Mr Pandey says the regulator had acted against content that breached its norms on investment advice.
“We have removed more than 120,000 such pieces of content from social media where we found egregious behaviour violating our norms,” he says.
Mr Pandey reiterated that SEBI regulations clearly mandate that only registered entities can provide investment advice.
“Our rules say that 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 stated.
While acknowledging the constitutional right to freedom of expression and the importance of financial education, the SEBI chief drew a distinction between general awareness and actionable investment advice.
“People have every right to express themselves and undertake financial education as part of their fundamental right to freedom of expression. Only when you transgress that line and actually mislead investors do we step in, seek removal, and have the content taken down,” he says.
Mr Pandey added that SEBI has the statutory authority to direct the removal of such content and that social media platforms have been cooperating with the regulator in enforcing takedown requests.
To strengthen digital surveillance, the market regulator has deployed an in-house artificial intelligence (AI) tool named ‘Sudarshan’.
“This tool helps us track audio, video, and other content to pinpoint where transgressions occur,” Mr Pandey says, adding that the system operates on a multilingual basis to detect violations across formats and platforms.
The move signals a sharper regulatory focus on the fast-growing ecosystem of 'finfluencers', many of whom operate outside the formal regulatory framework but command significant retail followings.
The SEBI chief also raised concerns about retail participation in derivatives markets, particularly options trading, which surged after the COVID-19 pandemic amid aggressive social media promotion.
Referring to options trading, he says many retail investors are 'much influenced by influencers post-COVID-19, possibly by misleading claims that there’s a lot of money to be made in these'.
SEBI responded by publishing data showing that retail investors collectively incurred substantial losses in derivatives trading. The regulator has also introduced a statutory risk warning.
“We also introduced a statutory warning, like those on cigarettes, stating that whenever you trade in options, nine out of 10 investors lose money,” Mr Pandey told the agency, adding that a pop-up message now appears to caution investors before executing such trades.
Describing market regulation as a calibrated exercise, the SEBI chairman stressed that the regulator’s approach is measured rather than heavy-handed.
“Market development is not about a sledgehammer approach but more like a surgeon’s knife – identifying problem areas and dealing with them,” he says.
Mr Pandey termed the past year 'a year of reform' for the market regulator, asserting that SEBI remains focused on achieving optimum regulation — neither over-regulating nor under-regulating the market.
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