Securities Exchange Board of India (SEBI), the Indian capital market regulator issued an interesting notice, where by it advised controls by intermediaries over the spread of unchecked information on social platforms by their employees. It urged organizations to step up checks and balances along with adequate controls to ensures responsibility of the circulated information. The seriousness can be assessed, as SEBI said "It is a well established fact that market rumours can do considerable damage to the normal functioning and behaviour of the market and distort the price discovery mechanisms."

The regulator said that all market intermediaries, meaning brokers, advisers or experts will be held responsible for circulating 'unauthenticated news' related to scrips, i.e. listed companies, in blogs, chats, e-mail etc.

It even acknowledged that many times rumours and in-verified information are circulated as news because there is a lack of proper internal controls by organizations resulting in havoc on the market.

For this reason the regulator has suggested few measures like internal code of conduct which should be implemented under which employees verify information on their official mails before distributing it or stating it in their blogs or tweet.

It also said that access to blogs, chat forums etc. should either be restricted under supervision or access should not be allowed. Logs should be maintained for any usage of such blogs, chat forums shall be treated as records and these same should be stored.

Employees should be directed that any market related news received by them either in their official or personal mail and blog or in any other manner, should be forwarded only after the same has been seen and approved by the compliance officer of the company.

Going a step further it has directed the exchanges to inform their brokers of the same information and that all should display about this policy on their websites. SEBI has also told the exchanges that they should communicate about the implementations in their 'monthly development reports.'

The depositories were also not provided with any leeway, they too were asked to circulate a notice with similar directions and implement procedures regarding spread of information or rumours from their end.