India’s capital markets regulator has taken down more than 1.2 lakh misleading social media posts by unregistered financial influencers and stepped up digital surveillance using artificial intelligence, Sebi chairman Tuhin Kanta Pandey said in an interview to ANI.

“We have removed more than 120,000 such pieces of content from social media where we found egregious behaviour violating our norms,” Pandey said, stressing the regulator’s intensified scrutiny of online investment advices.

Clear line between education and advice

Pandey reiterated that SEBI rules mandate that only registered entities can provide investment advice. “If you have to give investment advice, you have to be registered with SEBI. And being registered means you have certain do’s and don’ts,” he said.

While acknowledging the right to free expression and financial education, the SEBI chief drew a distinction between legitimate content and misleading claims. “People have every right to express themselves and undertake financial education… Only when you transgress that line and actually mislead investors do we step in,” he said, adding that social media platforms have cooperated with takedown orders.

AI-driven surveillance

To strengthen monitoring, SEBI has deployed an in-house AI-powered tool named ‘Sudarshan’. The system tracks multilingual audio, video and text content across platforms to detect potential violations.

“We are armed with our own AI tool called ‘Sudarshan,’ through which we are able to track, on a multilingual basis, audio, video and other content to pinpoint where transgressions occur,” Pandey said.

Retail derivatives risks under spotlight

Pandey also flagged the surge in retail participation in derivatives markets, particularly options trading, after the pandemic. He said many investors were influenced by social media narratives suggesting quick gains.

Sebi responded with data disclosures showing that a majority of retail traders incurred losses. The regulator introduced statutory risk warnings — including a pop-up alert stating that “9 out of 10 investors lose money” in options trading — to improve awareness.

Describing the past year as “a year of reform,” Pandey said Sebi’s approach is calibrated rather than heavy-handed. “Market development is not about a sledgehammer approach but more like a surgeon’s knife,” he said, stressing the goal of optimum regulation without stifling growth.