“We have removed more than 120,000 such pieces of content from social media where we found egregious behaviour violating our norms,” he said, reiterating that Sebi norms clearly state that investment advice can only be given by registered entities. “Our rules say that if you give investment advice, you must be registered with Sebi. And being registered means you have certain do’s and don’ts,” he further said, while speaking to ANI.
Clear line between education and misleading advice
Pandey drew a clear line between education and misleading advice, while acknowledging freedom of expression and the right to undertake financial education. “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 said.The market regulator has the power to order removal of such content, he said, adding that the social media platforms are cooperating in this regard.
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AI tool Sudarshan
The Sebi Chairman also spoke about the market regulator’s in-house AI tool Sudarshan. “We are armed with our own AI tool called ‘Sudarshan,’ through which we are able to track, on a multilingual basis, audio, video, and other content to pinpoint where transgressions occur,” he said.
Pandey highlighted that several retail investors are being influenced by these so-called influencers post-COVID to enter into the risk-prone territory of options trading, possibly by misleading claims that there’s a lot of money to be made in the derivatives markets.”Our data showed, and we made it public, that collectively there were substantial losses. We also introduced a statutory warning, like those on cigarettes, stating that whenever you trade in options, 9 out of 10 investors lose money. That’s the warning we are giving you. A pop-up message will appear,” he added.
Pandey clarified that Sebi’s actions are not heavy-handed but a calibrated exercise. “Market development is not about a sledgehammer approach but more like a surgeon’s knife – identifying problem areas and dealing with them,” he further said.
Earlier, Finance Minister Nirmala Sitharaman had spoken strongly against derivatives trading by retail investors, claiming that they lose significant sums of money in them. “We are touching only the futures and options segment. Speculation, what we call ‘satta’ in Hindi, is highly risky, and many people with limited funds face heavy losses. The nominal increase in STT is aimed purely at deterring excessive speculation,” Sitharaman said last month, after the Union Budget raised STT on futures to 0.05% from 0.02%, a 150% jump, while options premium and exercise taxes climbed to 0.15% from 0.1% and 0.12% respectively.
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