SEBI, DoT to crack down on dubious stock tips sent via text messages
Cyber crime experts have also been deployed to beat the problem at the source.
The Securities and Exchange Board of India (SEBI) and the Department of Telecommunications (DoT) are planning to clamp down on brokers sending unsolicited trading tips via text messaging.
According to a Business Standard report, SEBI and DoT were pushed to act against these messages after leading brokerage firms such Motilal Oswal, India Infoline Financial Services, Angel Broking and HDFC Securities complained to SEBI that their names were being misused in providing dubious investment advice.
A standard message comes with the stock name, its price and a possible price trigger to hook in investors. Although such messages were common earlier, this time, reputed brokers' names are attached to the messages, often with minor changes.
Sources told Business Standard that SEBI and DoT held a meeting last week, where SEBI shared its preliminary inquiry report. The Telecom Regulatory Authority of India (TRAI) called for SEBI to bring in filters to help take these offenders to task.
The surveillance team under SEBI is also following up on the mobile numbers which send the tips. Cyber crime experts have also been deployed to kill the problem at its source.“As a preemptive measure, Sebi could ask brokerages to put out an advisory, apart from regular disclaimers. Second, with the help of the cybercrime investigation cell of Mumbai Police, the regulator is trying to detect the origin of the such SMSes,” a Sebi official was quoted as saying.Last year, SEBI had floated a consultation paper to curb unauthorised investment tips through social media but is yet to pass the final guidelines on it.