SEBI Cracks Down on Online Investment Scams, Urges Social Media Giants to Step Up

In a decisive move to protect retail investors, the Securities and Exchange Board of India (SEBI) has escalated its efforts to combat the surge in online investment scams. On November 6, 2025, SEBI announced that it has formally communicated with leading social media platforms and internet search providers, urging them to implement robust mechanisms to prevent misuse of their platforms for fraudulent financial promotions.

This initiative aligns with the global call to action by the International Organization of Securities Commissions (IOSCO), which emphasized the critical role of digital platforms in curbing financial misinformation and fraud.

Key highlights:

• SEBI has asked platforms to introduce verified labels for regulated trading and investment apps to help users distinguish legitimate services
• The regulator is pushing for mandatory advertiser verification in the securities market domain
• The move aims to curb pump-and-dump schemes, illegal profit-sharing models, and misleading financial content
• SEBI emphasized that platform-level accountability is essential to safeguard investors in the digital age

Sources: SEBI Press Release, Moneycontrol, Livemint.