SEBI Chairman Tuhin Kanta Pandey has urged investors to be more careful about where they put their money, drawing a comparison with the time and attention people spend when buying everyday essentials such as vegetables.
“How can you just put so much of your money on something completely fake?” Pandey said during a discussion at NDTV Profit Ignite in Mumbai on Wednesday, referring to people who fall for fraudulent investment recommendations circulated through messaging groups.
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The Securities and Exchange Board of India (SEBI) chief said investors could be drawn into fake groups where members appear to endorse investment calls and promise exceptional or guaranteed returns.
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“In that fake world, people are believing and losing tons of money,” he said, stressing the need to distinguish genuine investment opportunities from fraudulent ones.
Pandey also said SEBI was providing tools to help investors identify genuine market participants and verify payment details before transferring money.
One such tool is SEBI Check, which allows users to check whether a bank account, UPI ID or QR code is associated with a regulated securities-market recipient. Pandey said the check can be completed in about 30 seconds.
He also pointed to verified labels for trading apps on the Google Play Store in India, developed through SEBI's work with Google. The labels are intended to help users identify apps associated with regulated entities.
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Regulator Steps Up Action
Pandey said SEBI had escalated more than 2.2 lakh instances of misleading online content to social media platforms for takedown. He said the regulator acts on evidence of wrongdoing, using filters alongside human judgement.
He also made clear that SEBI would take a tough approach to malpractice involving WhatsApp and Telegram investment recommendations.
The regulator is using its Project Jagrook investor-awareness campaign to spread information about these risks and encourage people to use verification tools before handing over money.
Pandey's message was that investors should not rely on the confidence or apparent consensus of people in online groups. They should check who is receiving their money and whether the recipient is a legitimate securities-market entity before proceeding.
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