Sebi removes over 15,000 finfluencer content in crackdown on unregulated entities

The Securities and Exchange Board of India has in the past three months taken down more than 15,000 ‘content sites’ by unregulated financial influencers as part of its efforts to protect investors, wholetime member Kamlesh Varshney.

These finfluencer content were pulled down by technological platforms on Sebi’s request, he said. This was in line with Sebi’s decision in July to restrain regulated entities from associating with finfluencers. 

Varshney said Sebi was trying to ensure that investor education and regulation can seamlessly co-exist and was aware of the unregulated activity of unregistered finfluencers in the market.

“They are misguiding investors and losing money. We have been getting a lot of complaints from investors. Then we work with technological platforms where unregistered people give advice,” he said. “More than 15,000 content sites have been taken down by them in the last 3 months after we referred to them.”

Also read | Meet the new YouTube finfluencers - teenagers trading options ‘making 36-40%’

Varshney also highlighted that the markets regulator had asked the technology platforms to create a system to identify unregulated content, in addition to Sebi’s supervision.

Speaking on the final day of the Global Fintech Fest, Varshney mentioned that Sebi had received more than 1,000 responses to its proposal to relax some severe restrictions on registered investment advisers (RIAs) and research analysts (RAs).

“We have a policy framework in mind and issued a consultation paper. We will take it up in the next board meeting,” he said. “The idea is to reduce entry barriers. We provide clarification on the grey area and what is to be done. This, along with investor education, will create a lot of investment advisers in future.”

Sebi’s board may approve the proposal in its next meeting scheduled for September, he added.

Also read | Why Sharan Hegde’s financial advisory business is a test for Sebi's rules regulating ads by advisers and finfluencers

Varshney reminisced how trading took place two decades ago and how it has undergone changes because of technology.

“There were visionaries who made use of technology, came up with startups and became successful entrepreneurs today. We are again on the verge of new technology which will change the look of the financial markets. We do not know how, but there are visionaries who will know how the market will look,” Varshney said.

Sebi will also be floating a discussion paper on tweaking regulations for initial public offerings (IPOs) of shares by small and medium enterprises by the end of this year, another wholetime member Ashwani Bhatia said on the sidelines of the event.

Also read | Sebi tweaks stocks’ F&O norms, curbs use of finfluencers