SEBI Warns Investors about Unauthorised Virtual Trading, Gaming Platforms
Moneylife Digital Team 04 November 2024
Market regulator, Securities & Exchange Board of India (SEBI) has cautioned investors against trading through virtual trading or gaming platforms and asked them to deal only through registered intermediaries.
 
The advisory statement came after the market regulator noticed that some apps, web applications and platforms offer virtual trading services, paper trading, or fantasy games to the public based on stock price data of listed companies.
 
The regulator said that such activities violate the Securities Contract (Regulation) Act, 1956 and SEBI Act, 1992, laws designed to protect investors.
 
SEBI reiterates that investors can invest and undertake trading activities in the securities markets only through or with registered intermediaries.
 
"Participation in unauthorised schemes, including sharing confidential and personal trading data, is at the investors' own risk, cost and consequences, as such schemes and platforms are not registered with SEBI," the market regulator says. 
 
Further, SEBI says investors may note that for any disputes relating to such activity, investors cannot take benefits of recourses like investor protection under SEBI and exchange jurisdiction, including SCORES and investor grievance redressal mechanism administered by exchanges or the online dispute resolution mechanism administered by exchanges and depositories through smartodr.in.
 
Earlier in August 2016, SEBI cautioned investors against leagues, schemes and securities market competitions involving prize monies distribution.
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