SEBI Implements New Social Media Advertising Requirements to Curb Investment Frauds

The Securities and Exchange Board of India (SEBI) has announced new guidelines requiring SEBI-registered intermediaries to undergo verification by social media platforms such as Google and Meta before publishing advertisements in a move aimed at combating investment fraud and enhancing transparency in the securities market.

SEBI's New Advisory:

On March 24, 2025, SEBI released an advisory outlining new requirements for SEBI-registered intermediaries when advertising on social media platforms. This initiative comes in response to a significant increase in scams related to the securities market on digital communication platforms, including YouTube, Facebook, Instagram, WhatsApp, X (formerly Twitter), Telegram, Google Play Store, and Apple Store. Scammers have been luring victims by promoting fake online trading courses and seminars, offering misleading testimonials, and giving false guarantees of risk-free or assured returns.

The Verification Process:

To tackle these fraudulent activities and protect investors, SEBI has consulted with social media platform providers to implement a verification process for advertisers. Initially, providers like Google and Meta will require SEBI-registered intermediaries to register using their email IDs and mobile numbers registered on the SEBI SI Portal. Following this registration, these providers will conduct advertiser verification of SEBI-registered intermediaries, allowing them to upload or publish advertisements on these platforms only after successful verification.

Requirements for Registered Intermediaries:

SEBI has advised all registered intermediaries intending to advertise on these platforms to update their contact details (consisting of email ID and mobile number) in the intermediary database on the SEBI SI Portal by April 30, 2025. This step is crucial to ensure accurate records and facilitate easy verification by both SEBI and social media platforms.

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