Source: Mint
Context:
The Securities and Exchange Board of India (SEBI) recently raided the Avadhut Sathe Trading Academy amid allegations of unregistered investment advice, signalling a stricter approach towards “finfluencers” and investor training platforms operating outside regulatory frameworks.
Key Highlights:
- New SEBI Circular (January 2025):
- Educators can only use stock data older than three months.
- Live prices, recent tips, or indirect recommendations are banned.
- Prohibited activities include stock-specific advice, return guarantees, demo trades, and coded investment suggestions.
- Legal Perspective:
- Experts highlight a fine line between education and advice; any suggestion influencing investment decisions can invite regulatory action.
- SEBI has powers to ban entities, seek refunds, and initiate criminal proceedings against violators.
Who are Finfluencers?
- Individuals who create finance-related content on platforms like YouTube, Instagram, Twitter (X) or any other platform.
- Cover topics such as stock market tips, mutual fund reviews, crypto trading, insurance, personal finance, and budgeting.
- Not all are qualified advisors, many are self-taught and operate without SEBI registration.
