Think twice before acting on TV stock tips: How front running cheats retail investors

Televised stock market advice along with viral telegram tips often lure innocent retail investors searching for quick equity market gains. Still, a darker concept of ‘front running’ has led to major enforcements by SEBI along with several strict actions to stop the plundering of retail investor money.

The regulator has recently barred analysts, anchors, brokers, market participants and fund dealers for abusing their influence to rake in huge profits ahead of recommendations.

What is front running and why does it matter?

Front running simply involves trading on advance, non-public information. This information can contain details about client orders or public stock tips to gain an unfair advantage of the common retail investors. Front running results in undermining market integrity and misleads investors.

Furthermore, it is punishable under Regulations 3 and 4 of Prohibition of Fraudulent and Unfair Trade Practices i.e., PFUTP Regulations (2003) and Section 15HA of the SEBI Act, 1992. Now penalties under this legal provision include fines of up to ₹25 crores or three times the profits made along with trading bans and time based restrictions.

Five key SEBI‑confirmed cases

1. Sanjiv Bhasin – IIFL stock tip scam (June 2025)
   Bhasin along with 11 others traded through affiliated entities, before publicly recommending stocks on leading media platforms such as Zee Business, CNBC Awaaz and Telegram. SEBI impounded him with ₹11.37 crore. The entire scam was carried out by using WhatsApp, phone, and trade records.
2. Zee Business guest analysts – Kiran Jadhav & others (Feb 2024)
   Several experts tipped stocks after connected traders already bought in, making ₹7.5 crore in unlawful gains. SEBI froze assets and issued bans under PFUTP. This was another shocking case of cheating innocent retail investors and luring them into trades based on tips.
3. Hemant Ghai – CNBC Awaaz anchor (Jan 2021)
   SEBI barred CNBC Awaaz anchor Hemant Ghai and his family for front-running. This scam involved buying stocks ahead of his on-air recommendations. They earned ₹6.1 crore illegally. This marked SEBI’s first action against a TV anchor for such misconduct.
4. Axis Mutual Fund case – Viresh Joshi & associates (Sept 2021–Mar 2022)
   SEBI barred Axis MF’s ex-chief dealer Viresh Joshi and 20 others for front-running fund trades between Sept 2021 and Mar 2022. ₹30 crore in illegal gains was impounded, with accounts frozen and action taken under PFUTP regulations.
5. IDBI Capital – Dedhia & Savla (May 2024)
   In this particular case, SEBI barred IDBI Capital’s Gaurav Dedhia and his sister Kajal Savla for front-running client trades using internal deal information. A total of ₹1.67 crore was recovered, and both were fined for violating market integrity under PFUTP regulations.

Now given the Axis Mutual Fund and IDBI Capital cases involve institutional front running i.e., a kind of practice where machinery of institutions was used to make unlawful gains.

On the other hand, the cases related to Bhasin, Jadhav and Ghai are nothing but media linked manipulative front running. According to SEBI both are fraudulent market practices under the PFUTP and are explicitly classified as illegal offences.

How to stay safe from front-running scams?

Therefore, taking into consideration the above cases carefully, you can stay safe from front running scams by following these simple steps diligently:

• Be wary of lucrative and buzzy stock tips on both television or Telegram.
• Check and confirm if the tipster is a registered investment adviser (check SEBI registry).
• Carefully cross check any sudden price jumps post recommendation.
• Depend only on independent research or verified brokerage reports.
• Report suspicious stock trades or timing inconsistencies to SEBI.

Hence, by consistently reading, understanding facts and building knowledge of equity markets along with taking guidance from investment professionals you can keep yourself safe from front running scams.

Disclaimer: This article is for informational purposes only and does not constitute investment, legal, or financial advice. All references to cases are based on publicly available SEBI records. Readers are encouraged to verify facts independently and consult a SEBI-registered investment adviser before acting on any stock recommendations.