Messaging or even simply forwarding stock advice could now land you in the soup as the Securities and Exchange Board of India (SEBI) has set a precedent to penalise the practise – regardless of monetary gains.
SEBI’s latest order comes after two senior employees of Antique Broking were fined Rs 15 lakh each for exchanging insider tips to institutional investors on several investor groups on WhatsApp. The trouble started when some predictions turned out to be accurate.
The duo posted several predictions for blue-chip companies such as Wipro, Axis Bank, Mindtree and Asian Paints, based on Unpublished Price Sensitive Information (UPSI) or publicly undisclosed information, The Economic Times reported. Doing this is an offence per SEBI norms, even if the parties involved do not make a profit.
Moin Ladha, partner, Khaitan & Co told the paper that trading regulations limit “direct or indirect communication of UPSI, irrespective of the same being relied upon for trading”, and involved parties must thus carefully consider further dissemination.