SEBI escalates 1 lakh digital violations, Warns retail investors

More than one lakh unlawful or misleading posts have been removed from social media platforms over the past 18 months, the Securities and Exchange Board of India (Sebi) Chairman Tuhin Kanta Pandey said on Monday, stressing the regulator’s resolve to safeguard investors from online fraudsters.

Speaking at an investor awareness event at the National Stock Exchange (NSE), Pandey said Sebi has taken up the issue of unlawful digital content with major platforms such as Google and Meta. He noted that while technology has expanded market access, it has also enabled wrongdoers to spread deceptive messages targeting gullible investors.

“More than one lakh such items have been escalated in the last 18 months,” Pandey said, highlighting the regulator’s ongoing digital crackdown. Referring to a Sebi survey of 90,000 respondents, Pandey revealed that only 36 per cent of participants possessed a high or moderate level of knowledge about capital markets leaving a large section of investors vulnerable to misinformation and fraud.

“This knowledge gap is a vulnerability that exposes our investors to risks and makes them susceptible to fraud,” he warned, adding that when trust is eroded, investment slows, savings remain idle, and the cost of capital rises. Pandey said investor education and awareness remain key priorities for Sebi, which is expanding its outreach through local offices in state capitals and other key cities. The regulator is also tailoring awareness campaigns based on preferred media channels identified in its surveys.

Urging investors to exercise caution, Pandey advised, “First, invest your time. Second, verify, don’t trust blindly. Third, question unrealistic promises. Fourth, do your own research.” He also encouraged investors to read Sebi’s Investor Charter for guidance.

He pointed to the derivatives market as an area of concern, citing Sebi studies showing that over 90 per cent of retail trades in derivatives end in losses. “Derivatives are meant for hedging and risk management, not for quick gains which may be illusory,” he said.

At the same event, NSE Chairman Srinivas Injeti said the exchange is advancing plans for a public listing to set an example for other companies. “One of the motivations for NSE to go public is to exemplify that it stands for what it expects from listed companies and to lead by example,” Injeti said, noting that despite not being listed, NSE already has a shareholder base of nearly 1.8 lakh.