Sebi Member Issues Caution on Market Manipulations, Stresses Investor Trust

On Saturday, February 24, Securities and Exchange Board of India (Sebi) Whole Time Member Kamlesh Chandra Varshney issued a strong caution against manipulations in the capital market. Addressing an event in the national capital, Varshney urged brokers to remain vigilant and actively prevent such instances.

Representative image

The Rise of Investor Participation

Varshney highlighted the significant growth in investor participation in the securities market, which is expected to play a crucial role in India's pursuit of becoming a developed economy. As of December 2023, the total number of demat accounts reached 13.9 crore, marking a 20% increase in just nine months and doubling the count in two-and-a-half years.

Investor Trust: The Foundation of Success

Varshney emphasized the paramount importance of investor trust, stating that without it, the entire system would fail. He acknowledged that manipulations continue to occur, and while Sebi cannot intervene in all cases, he urged the broker community to be vigilant against bad elements attempting to enter the system.

Sebi's Actions Against Misdoings

In its efforts to combat market irregularities, Sebi has taken decisive action against various entities involved in manipulations, including front-running activities. The markets watchdog remains committed to ensuring a fair and transparent market environment.

Leveraging Technology for Efficiency and Growth

Varshney also highlighted the importance of technological advancements in improving efficiency and business operations. He encouraged entities to embrace technological developments to stay competitive and enhance their services.

Sebi's Use of Artificial Intelligence

In response to a question fromon whether Sebi is utilizing Artificial Intelligence (AI), Varshney confirmed that the regulator is indeed employing AI for investigations and various other purposes.

Cybersecurity Framework for Regulated Entities

Varshney announced that Sebi will soon introduce a comprehensive cybersecurity and cyber resilience framework for regulated entities. This framework will be mandatory for all regulated entities to ensure robust protection against cyber threats.

ANMI's Commitment to Sustainability and Transparency

Vijay Mehta, President of the Association of National Exchanges Members of India (ANMI), shared that over 5.4 million new investors joined the market in the previous month. ANMI remains dedicated to prioritizing sustainability, technology, inclusion, and transparency in the realm of finance and investment.

Sebi's caution against market manipulations and its emphasis on investor trust underscore the critical importance of maintaining a fair and transparent capital market. As the number of investors continues to grow, Sebi's proactive measures and the adoption of advanced technologies will be instrumental in fostering a robust and sustainable financial ecosystem in India.