What Sebi should do to bring financial influencers bring under its ambit?

There is a big problem when it comes to consuming specific financial content on social media. A social media account with a large number of subscribers is attractive and followers always believe that these tips can be amazing. Groww’s social media influencer and content strategist Aditi Khandelwal quotes, “There was one time when I saw an influencer giving wrong advice that clearly showed they had no knowledge of the subject.”

The reason for this, Arijit Sen, Sebi RIA, co-founder, Merrymind, pointed out that the existing regulatory framework does not have the responsibility of content creators to declare whether they really have the skills to represent themselves as Financial Advisors. they are special. or not.

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While controlling social media will not be an easy task, the Securities and Exchange Board of India (Sebi) is trying to find a solution. On Thursday, Sebi said it is working on guidelines for financial operators in such sectors.

“This is a long awaited move for the benefit of investors in general. “Irrelevant and/or false claims by content creators must be followed up and necessary measures taken for the growth of the investment industry as a whole,” said Sen.

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What should Sebi do?

Talking about the urgent action required from the board, Sebi RIA Avinash Luthria said, “For example, closure of unregistered investment advisers and research analysts who collect fees from clients. As well as changing the rules to prevent most brokers from making unsolicited recommendations on futures, options and micro-cap stocks. ”

Therefore SEBI may be forced to try to convince the Advertising Standards Council of India (ASCI) to be stricter on financiers, advertisers and traditional/social media platforms. Besides, from the list of non-compliant companies of ASCI, SEBI can inform the securities related parties, he said.

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On March 10, Sebi banned market operators for allegedly manipulating stocks through social media. It conducted searches in at least seven homes and one business across several locations in Ahmedabad and Bhavnagar in Gujarat, Neemuch in Madhya Pradesh, New Delhi and Mumbai.

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