SEBI Warns Against Unauthorised Trading on Gaming Platforms
Several apps and web platforms are offering virtual trading services without proper registration, potentially misleading users, SEBI said.
The Securities and Exchange Board of India on Monday raised caution over the rise of unauthorised virtual trading and gaming platforms that simulate stock trading using real stock price data.
SEBI, in an advisory, warned that several online apps and web platforms are offering these services without proper registration, potentially misleading users by providing unapproved trading advice and virtual stock trading features.
These platforms, the market regulator said, operate outside the bounds of the securities laws designed to protect investors. SEBI noted that only registered intermediaries are authorised to facilitate trading in the markets, and investors engaging with the unregistered platforms are doing so at their own risk.
For activities conducted on unauthorised platforms, investors would not have access to key protections, such as SEBI’s investor grievance redressal system or the online dispute resolution mechanism provided by stock exchanges, SEBI pointed out.
The regulator urged investors to avoid engaging with the unauthorised trading apps and platforms to ensure their investments remain safeguarded under-regulated channels.
SEBI also reminded the public of a 2016 advisory, which had warned investors against schemes and competitions involving prize distribution based on securities trading.
