India's Securities and Exchange Board of India (SEBI) warned that planted praise and false profit claims can lend credibility to private stock-tip groups, before Chairman Tuhin Kanta Pandey called for tougher action, NDTV Profit reported.
Pandey spoke at NDTV Profit Ignite in Mumbai on Wednesday, Oct. 28, the outlet reported. “We have to actually stop the malpractices with a heavy hand,” he said. Pandey added: “In that fake world, people are believing and losing tons of money.” NDTV Profit reported both remarks.
SEBI’s Oct. 22 warning about WhatsApp stock-tip groups described invite-only chats where unregistered operators circulated buy and sell calls as free investor education. The regulator said foreign phone numbers were sometimes used, while people aligned with the organizers posted claims of gains and praise for a supposed market expert. Such posts, SEBI said, can make recommendations seem validated by other group members.
The regulator also said chats closed after enforcement may be followed by invitations to new groups from different numbers. It advised investors against joining groups run by unknown people, following their tips, transferring money to apps promoted in them or sharing trading-account details. SEBI recommended using registered intermediaries and authentic apps.
SEBI Check lets users verify UPI IDs and account details, while the regulator’s investor website offers QR-code verification. In March, SEBI launched a verified label on Google Play for trading apps from brokers registered with the regulator; it said it planned to add apps from other regulated intermediaries.
The Ministry of Finance said SEBI launched its “Samajh Se Investing Simple” campaign under Project Jagrook on Oct. 5, using multiple languages and channels to promote informed investing and prevent fraud. SEBI issued a similar caution about unsolicited WhatsApp and Telegram stock tips in 2020. The latest advisory did not name specific groups or operators or provide figures for affected investors or losses.