SEBI Regularly Issues Warning, Directives To Safeguard Investors Interest: MoS Finance
The minister informed the Parliament on Tuesday that the SEBI’s regulations prohibit individuals from providing investment advice without registration with the capital markets regulator.
SEBI, in a bid to protect retail investors, has implemented several measures, including a warning against trading based on stock tips from unregistered entities, Minister of State for Finance Pankaj Chaudhary told the Parliament during question hours. The regulatory body has also conducted investigations and issued directives against non-compliant entities, he said
The minister informed the Parliament on Tuesday that the Securities and Exchange Board of India’s regulations prohibit individuals from providing investment advice without registration with the capital markets regulator.
SEBI’s guidelines for investment advisers outline eligibility criteria for registration, obligations, responsibilities, and procedures for addressing defaults. Chaudhary outlined these measures in a written reply to the Rajya Sabha.
In response to concerns about social media frauds posing as stock market experts, Chaudhary emphasised that SEBI has issued multiple press releases advising investors to consult only registered investment advisers for financial guidance.
Investors can check the registration status of the entity providing investment advisory services on the regulator's website.
Additionally, the regulator has cautioned investors against trading in the securities markets based on the tips/recommendations provided by unregistered entities/persons and entities impersonating Sebi-registered intermediaries, the minister said.
"On receipt of any complaints/references against unregistered entities carrying out such activities, and also after suo moto cognizance, Sebi conducts examination of these entities. In case of non-compliance, appropriate sections of the Sebi Act, 1992 and various Sebi Regulations are invoked, and requisite directions are issued to non-compliant entities," he added.
Further, the issue of the association of SEBI-regulated intermediaries with such unregistered persons or entities was discussed in the SEBI's Intermediary Advisory Committee.
Considering its recommendations, a proposal for carrying out necessary regulatory amendments to restrict the association of all SEBI-regulated intermediaries with any unregistered entity has been approved, Chaudhary said.
(With inputs from PTI)
