Last Update: March 05, 2023, 17:01 IST
SEBI classifies such schemes as fraudulent and abusive commercial activities that threaten the integrity of the Indian capital market (Image: Shutterstock)
Explained: Arshad Warsi and some others ‘inflated’ share prices of Sadhna Broadcast and Sharpline Broadcast by uploading misleading videos on YouTube channels, says SEBI
The Securities and Exchange Board of India (SEBI) recently banned 31 entities including actor Arshad Warsi, his wife Maria Goretti, YouTuber Manish Mishra and promoters of Sadhna Broadcast – Shreya Gupta, Gaurav Gupta, Saurabh Gupta, Pooja Aggarwal and Varun Media. Have given. In a case relating to uploading of misleading videos on YouTube channels advising investors to buy shares of the company, according to a report in the securities market by Indian Express,
Besides, the regulator seized illegal gains made by entities following a “pump and dump” scam of Rs 41.85 crore, the report said, adding that all 31 persons were found to have opened an escrow account with a scheduled commercial bank and seized it. Amount required to be deposited. within 15 days.
But what is pump and dump scam?
Stock market manipulator creates a YouTube or Instagram channel, suggests a report Peppermint, Huge amount is spent on promotion to increase the reach of the channel. Sadhna Broadcast Limited and Sharpline Broadcast Limited paid Rs 4.72 crore to market stations with names like Moneywise, The Advisor, Midcap Calls and Profit Maker.
Then, misleading claims are made (pumped) about the stock. For example, in the case of Sharpline, it was claimed that the company is owned by the Adani group. Manipulators sell stock after gullible investors buy it (the dump).
Whenever share-price extremes are reached, vested interests “dump” the shares by booking profits, leaving average investors inexperienced and liable to lose invested money. SEBI classifies such schemes as fraudulent and abusive commercial activities that threaten the integrity of the Indian capital market. ,
What happened in Arshad Warsi case?
According to SEBI, Arshad Warsi and some others “inflated” the share prices of Sadhna Broadcast and Sharpline Broadcast by uploading misleading videos on YouTube channels. These YouTube videos spread fraudulent and misleading information advising investors to buy Sadhna and Sharpline stocks for big returns. Says a report in The Economic Times.
After the release of the recordings, SEBI discovered a spike in the share price and trading volume of the two firms between April and July last year.
The high volume indicated that many retail investors were inspired by the video and bought the shares. Simultaneously, Arshad Warsi, promoter stockholders and others sold their interests at inflated prices and made profits. As per the regulator, Arshad Warsi made a profit of Rs 29.43 lakh and his wife made a profit of Rs 37.56 lakh.
stay sharp
With the advent of financial influencers and the immense reach of social media, there is no shortage of personal finance advice. But, according to experts, some influencers with vested interests end up harming the financial stability of an individual, reports ET. They caution retail investors to exercise caution before acting on unapproved advice from various sources, especially social media.
with inputs from agencies
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