New guidelines for financial influencers under works

The Securities and Exchange Board of India (Sebi) is formulating guidelines for financial influencers or finfluencers, curbing the unsolicited and rampant stock recommendations and financial advice on social media platforms without availing the market regulator’s registration.

At the sideline of an event in Mumbai, Sebi whole time member Santosh Kumar Mohanty said, “Sebi is working on guidelines for financial influencers.”

The watchdog had earlier warned investors to not rely on stock tips, recommendations and financial advice received on social media platforms.

Mohanty clarified that even if there is a lack of contract, they may be liable for action for giving financial advice without being registered with the markets regulator. Furthermore, giving a disclaimer about not being registered with Sebi and still continuing to give recommendations may also invite a regulatory action.

Experts say this will curb the influencers which post stock recommendations.

Earlier, Sebi chairperson Madhabi Puri Buch had hinted at regulators’ initiative to curb unsolicited recommendations on all kinds of platforms including Telegram and WhatsApp.