To stop people from being misled in the stock market, SEBI is planning to work directly with social media platforms like YouTube, Telegram, and Meta. Many unregistered financial influencers, also called fininfluencers, are using these platforms to spread false information and cheat small investors. SEBI wants to control such activities by working with the platforms.
As part of this new move, SEBI will ask these platforms to stop showing content from people who are not officially registered financial advisors. Reports say most platforms have agreed to follow SEBI’s instructions. They will now check if a content creator is registered before allowing them to post investment-related videos or messages.
Sources say that platforms are also working to remove content posted by unregistered users. If a platform does not follow SEBI’s rules, the regulator may stop other regulatory bodies from working with that platform. SEBI can also use its powers to prevent official organisations from partnering with or doing business on those platforms.
This is not SEBI’s first step in this direction. Last year, SEBI had already instructed all regulatory bodies not to deal in any way with unregistered influencers. This included stopping financial deals, client referrals, IT system links, and similar partnerships. Because of this rule, unregistered advisors lost their income from sponsorships.
SEBI now wants to fully regulate finfluencers and protect users from misleading investment ads. For example, Meta announced on June 26 that anyone who wants to post securities or investment-related ads on Facebook, Instagram, or WhatsApp will need to get verified first.
Shockingly, only 2% of finfluencers are currently registered with SEBI. This raises serious worries about the spread of false financial advice. Also, 8% of investors have admitted they were cheated or misled at some point, making SEBI’s move very important for investor safety.
