India’s market regulator has warned that invitation-only WhatsApp groups are circulating unauthorized stock calls, with planted gains claims and staged praise potentially making the recommendations seem credible to investors.
In an advisory dated Oct. 22, the Securities and Exchange Board of India (SEBI) said unregistered people sometimes frame buy and sell calls as free investor education and use overseas mobile numbers. It warned that the groups’ presentation can make unauthorized recommendations seem like legitimate guidance.
SEBI said people working with group operators may post claims of trading gains and praise a purported market expert. The regulator calls this “astroturfing,” describing posts that create the impression of genuine backing for the stock calls. The tactic can make messages from people linked to the operators look like independent confirmation.
The advisory also describes invitations to replacement groups. A message may say an earlier group was suspended, closed or banned, then invite members to join another one. SEBI says investors should leave groups using this approach.
The regulator advises investors not to rely on other members’ profit claims or trade confirmations. It also warns against opening accounts on or downloading trading apps recommended in the groups, and says investors should use registered intermediaries and authentic apps. Its general guidance identifies guaranteed or near-certain returns and pressure to act quickly as additional warning signs. Investors can check intermediaries through SEBI’s official directory.
SEBI previously cautioned the public in December 2016 about unsolicited calls and text messages promising profits from trading tips. The Oct. 22 advisory does not identify a particular group or operator, or give figures for affected investors or losses.
