Asmita Patel Global School of Trading
Ms. Patel has more than half a million subscribers on YouTube and hundreds of thousands of others on Instagram
The mission of Youtuber Asmita Patel was to “trade in India”.
The extremely popular financial influencer was called “She -Wolf of the Stock Market” – her point of view on the Hollywood film The Wolf of Wall Street. At the last count, she had timed more than half a million subscribers on YouTube and hundreds of thousands on Instagram. The fees for its stock negotiation lessons went to thousands of rupees.
Last month, the Regulator Securities and Exchange Board of India (SEBI) put an in progress. This forbidden her and six others from negotiating, alleging that she sold advice on illegal actions disguised as investors education and making millions of rupees in the market.
The repression of the regulator against the patel is his last attempt to tighten the node flowing around influencers of social media offering rapid money programs and disguised commercial advice.
The Boom of the India post-pandemic market has attracted a wave of new MOM-AND-POP investors. Online trading accounts rose from 36 million in 2019 to more than 150 million last year, according to brokerage data than Zerodha.
Many of these first entrants in the market relied on social networks for commercial advice which, in turn, gave birth to a new breed of self -proclaimed “investment gurus” or “financial influencers” like Ms. Patel, promising rapid money.
With only 950 registered investment advisers and 1,400 financial advisers in the country, these influencers quickly filled the void, raising hundreds of thousands of subscribers and followers.
Most function without regulatory registration, blurring the border between investment councils and market education. This prompted sebi to repress, prohibiting at least a dozen influencers, including a Bollywood player, to offer commercial advice.
The regulator has also prohibited brokerage houses and market players to associate with influencers who tighten advice on illegal stocks or make misleading yield complaints.
The regulator found Ms. Patel and her husband, Jitesh, ordered students and investors to exchange specific actions through their consulting firm. She would have used private telegrams, zoom calls and courses to sell advice without compulsory recording.
SEBI was in the case of Ms. Patel after 42 participants complained about negotiation losses and requested compensation. It is now evolving to seize millions of rupees that the Patel and its associates obtained from course costs between 2021 and 2024.
The regulator acted in the case of a patel after 42 participants complained about negotiation losses
While the markets are correct, the economy slows down and regulators retract, other influencers are faced with a credibility test.
Thousands of angry investors have recently accused high -level influencers to have simulated their success to sell trading courses and win millions of brokerage references.
SEBI’s order in the case of Ms. Pate also revealed that it had earned just over $ 13,700 (£ 10,800) as commercial benefits in the past five years but has won more than $ 11.4 million (9 million pounds sterling) by selling lessons.
Ms. Patel did not respond to the request for comments from the BBC.
Although SEBI’s desire to protect small investors is well intentioned, its recent regulatory actions have aroused criticism to be delayed and lack of clarity.
The regulator was both a “reluctant regulator” and “reluctant”, told Sucheta Dalal’s BBC, journalist and veteran financial author.
“He should have acts a few years ago when commercial sites began to pay influencers to promote their products. Now this phenomenon has become too big.”
Sumit Agrawal, a former SEBI officer, said the regulator left a few as an example instead of applying a clear and complete policy.
“The reduction of unregulated stock advice is necessary, but obliging schools to use three-month data for educational purposes and not to teaching the practical experience of trading strategies on the live market transforms into overflowing,” he said.
Manish Singh, authorized accountant and Youtuber with half a million followers, makes market analysis videos. He says that the new SEBI rules have created confusion on what is authorized.
“Even real content creators who try to guide people in the right direction will lose subscribers and monetary incentive of brand agreements such as confidence to work with the creators is shaken,” Singh told the BBC.
Getty images
Online trading accounts went from only 36 million in 2019 to more than 150 million last year
Balancing will be difficult for the regulator, explains Mr. Agrawal.
Technology is intrinsically disruptive and the law “still plays catching up”. The real SEBI challenge, he adds, is to effectively monitor the content online without resolving too much. In particular, the Indian regulator has wider powers than its counterparts in advanced markets like the United States.
“He has great authority, including the powers of research and crisis and the capacity to prohibit bank negotiation and freeze accounts without requiring the court order,” said Agrawal.
A Reuters report, citing sources, says that the regulator has again requested larger powers – his second request in two years – to access call files and social media cats in investigations on market violations led by influence.
The challenge, according to experts, will be to make sure that he does not throw the baby with bath water.
