The Securities and Exchange Commission (Sebi) has begun a crackdown on market operators who are inflating stocks on Telegram. The market regulator has begun cracking down on such market operators in Gujarat for alleged stock manipulation through social media platforms, in response to the growing number of scams.
On Wednesday, officials from the Sebi's surveillance branch carried out 'search and seizure' operations at the offices of three firms in Ahmedabad and Mehsana. These entities are suspected of using chat apps like Telegram to manipulate stock prices. They would purchase certain stocks and then post messages in Telegram channels with a huge subscriber base urging people to sell the equities they had purchased. After reaching the favourable price, they would square off their holdings. Officials from the Sebi seized the seamsters' cellphones. Messages promoting stocks in which they had holdings were discovered during an investigation.
According to sources, Gujarat operators under Sebi investigation traded using the "BTST or Buy Today" and "Sell Tomorrow" strategies. This entails selling shares the next day after purchasing them. With a greater emphasis on social media, the capital market regulator will focus more on such offences.
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