India plays ‘whack-a-mole’ with online financial influencers

{"text":[[{"start":10.1,"text":"This article is the latest part of the FT’s Financial Literacy & Inclusion Campaign."}],[{"start":15.8,"text":"In April, just over two years after India’s markets regulator banned an influencer self-styled Baap of Chart, or “father of charts”, from sharing financial education videos, he was back on social media asking his millions of followers for ideas on how to “grow together”."}],[{"start":32.900000000000006,"text":"The brazen reappearance of the influencer, whose real name is Mohammad Nasiruddin Ansari and whose YouTube channel had a peak of nearly 4.4mn subscribers, underscores the whack-a-mole nature of India’s effort to rein in unlicensed “finfluencers”."}],[{"start":49.85000000000001,"text":"As the number of individual Indian investors grows — more than trebling since 2019 to 146mn, alongside a 50 per cent rise in the Nifty 50 index — regulators are cracking down on fraudsters who give stock tips under the guise of general financial knowledge. India’s capital markets watchdog has said in written orders that some content creators “indulged in fraudulent activity”."}],[{"start":75.60000000000001,"text":"“We have finfluencers who have, I think, post-Covid, had quite a field day,” Tuhin Kanta Pandey, chair of the Securities and Exchange Board of India, said in an interview with the FT."}],[{"start":87.9,"text":"In the case of Ansari, Sebi said he and his associates had made Rs172mn ($1.8mn) promising “educational” workshops and “a chance to earn 200-300 per cent profit” but were actually giving investment advice that benefited them."}],[{"start":106.9,"text":"“They thought they could sell dreams that many people have made profits in the short-term options market,” said Pandey. “These dreams were completely hyped and were even outright lies in some cases.”"}],[{"start":119.4,"text":"Between April 2024 and May 2026, Sebi said it removed or banned 162,000 posts or accounts of numerous finfluencers from platforms including Instagram, Telegram and YouTube."}],[{"start":134.95000000000002,"text":"While Sebi allows sharing of content on general finance, it prohibits anyone who is not registered with the regulator from providing direct or indirect advice related to securities, or making claims “of returns or performance expressly or impliedly” about securities."}],[{"start":151.55,"text":"One finfluencer banned in January this year, Avadhut Sathe, had more than 900,000 subscribers on YouTube. Sebi said he and his associates had collected Rs6bn from clients for courses and access to a WhatsApp group where Sathe provided stock tips since October 2015."}],[{"start":171.20000000000002,"text":"From March 2024 to November 2025, he and his associates booked a net trading loss of Rs62mn, “whereas they were advertising themselves as market experts” and “charging huge fees” for courses, said Sebi."}],[{"start":186.8,"text":"Neither Ansari nor Sathe was registered as an adviser licensed to give investment advice."}],[{"start":192.95000000000002,"text":"“We found that they were transgressing the boundary where education on stock market stops and where giving stock tips and advice begins,” said Pandey."}],[{"start":200.4,"text":"Ansari and Sathe did not respond to requests for comment."}],[{"start":null,"text":""}],[{"start":204.35,"text":"While governments around the world are grappling with finfluencers who blur the line between investment education and advice, India’s problem is particularly challenging because of the rapid increase in novice retail investors and the multilingual landscape of the world’s most populous country."}],[{"start":222.45,"text":"Sebi has developed an AI tool called Sudarshan — named after the Hindu deity Krishna’s weapon of choice, a spinning blade — to scan posts and accounts in India’s more than 20 constitutionally recognised languages. Pandey said it had increased Sebi’s ability to identify and take down problematic posts by nearly 40 per cent."}],[{"start":243.85,"text":"As foreign institutions pull money out of India, retail investors have become the bedrock of domestic capital markets, mostly through mutual funds."}],[{"start":253.29999999999998,"text":"Foreign institutional ownership of companies listed in the National Stock Exchange of India reached a 14-year low of 16.1 per cent in March, while the share of mutual funds hit an all-time high of 11.4 per cent, according to market research provider Prime Database."}],[{"start":null,"text":""}],[{"start":270.79999999999995,"text":"Sumit Agrawal, a former Sebi officer and founder of Regstreet Law Advisors in Mumbai, said the economics of providing digital financial advice were “quite compelling” because of the “large retail audience willing to pay for tips”."}],[{"start":285.94999999999993,"text":"But these novices have also incurred heavy losses on the derivatives market. A Sebi study last July showed that as the number of individual traders more than doubled to 9.6mn between March 2022 and March 2025, nine in 10 of them lost money, with total annual losses jumping from $4.35bn to $11.3bn."}],[{"start":309.5999999999999,"text":"Not all of these losses could be attributed to finfluencers, said Renuka Sane, managing director of TrustBridge, a policy advocacy group."}],[{"start":317.7999999999999,"text":"“What is surprising to me is that Sebi considers this to be such a big issue,” she said. While scammers need to be held accountable, “I don’t think that you can be in a place where there is no responsibility on consumers of such content to verify before they make their investment decisions”."}],[{"start":333.9999999999999,"text":"Sebi chair Pandey said it had launched multiple tools for investors to check the legitimacy of platforms through which they traded and the accounts to which they sent money. The regulator has also started a social media campaign called Sebi vs Scam."}],[{"start":350.1999999999999,"text":"While Sebi’s core concern was valid, Agrawal said there was “a risk that some genuine educators and simulators may get caught in the crossfire, which makes calibration important”."}],[{"start":361.2499999999999,"text":"“A crackdown of this nature cannot eliminate the problem,” he said, “but it can reduce its visibility and curb the more blatant forms of misconduct”."}],[{"start":378.4999999999999,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1782096972_3776.mp3"}