SEBI Mandates Social Media Disclosures For Investment Advisors

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SUMMARY

SEBI has mandated IAs to disclose social media presence twice a year to its appointed supervisory body, IAASB

Advisors are now required to disclose accounts, pages, channels or other details operated by them on social media platforms like Facebook, Twitter, among others

The market regulator will also require these entities to disclose details of bank accounts they have set up to receive advisory fees, office addresses, shareholding patterns among others

In a recent circular issued on May 7, India’s securities and commodities market regulator, Securities and Exchange Board of India (SEBI), has mandated that investment advisors (IAs) disclose their social media presence twice a year to its appointed supervisory body, Investment Advisers Administration and Supervisory Body (IAASB). 

Under this, advisors are required to disclose accounts, pages, channels or other details operated by them on social media platforms like Facebook, Twitter, among others. Further, they are required to report the aforementioned details on September 30 and March 31 of every financial year. Prior to the circular, which is applicable with immediate effect, the IAASB was seeking reports from IAs on an ad-hoc basis.

“Based on the recommendations received from Industry Standards Forum (ISF), a standardised periodic reporting format for submission of information by IAs pertaining to their activities on a periodic basis has been prepared,” the market regulator notified in its circular.

The reporting format also includes IAs to disclose the details of the bank accounts they have set up to receive advisory fees, office addresses, shareholding pattern that must have details of shareholders with 10 percent or more holding, details of advertisements issued, and number of complaints received.

Over the past year, SEBI has increased its vigil on social media platforms where interest of investors in the securities market get compromised on a routine basis. According to SEBI data in October 2023, India had  over 1,300 registered investment advisors catering to over 80 Mn investors. 

The size of the market also allows unregulated entities to dole out unsolicited or unverified advice on social media platforms. SEBI’s actions against unregulated financial influencers increased after social media posts related to financial advice from multiple internet influences including Ravisutanjani Kumar, Abhishek Kar and Ankur Warikoo raised major controversies

In September 2023, SEBI released a consultation paper proposing regulated entities to dissociate themselves from finfluencers. It was later reported in January that the market regulator is mulling to bring finfluencers into the regulatory net so that it becomes easy to monitor whether they are complying with the security laws. 





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We strive to uphold the highest ethical standards in all of our reporting and coverage. We StartupNews.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It’s possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.

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SEBI Mandates Social Media Disclosures For Investment Advisors


SUMMARY

SEBI has mandated IAs to disclose social media presence twice a year to its appointed supervisory body, IAASB

Advisors are now required to disclose accounts, pages, channels or other details operated by them on social media platforms like Facebook, Twitter, among others

The market regulator will also require these entities to disclose details of bank accounts they have set up to receive advisory fees, office addresses, shareholding patterns among others

In a recent circular issued on May 7, India’s securities and commodities market regulator, Securities and Exchange Board of India (SEBI), has mandated that investment advisors (IAs) disclose their social media presence twice a year to its appointed supervisory body, Investment Advisers Administration and Supervisory Body (IAASB). 

Under this, advisors are required to disclose accounts, pages, channels or other details operated by them on social media platforms like Facebook, Twitter, among others. Further, they are required to report the aforementioned details on September 30 and March 31 of every financial year. Prior to the circular, which is applicable with immediate effect, the IAASB was seeking reports from IAs on an ad-hoc basis.

“Based on the recommendations received from Industry Standards Forum (ISF), a standardised periodic reporting format for submission of information by IAs pertaining to their activities on a periodic basis has been prepared,” the market regulator notified in its circular.

The reporting format also includes IAs to disclose the details of the bank accounts they have set up to receive advisory fees, office addresses, shareholding pattern that must have details of shareholders with 10 percent or more holding, details of advertisements issued, and number of complaints received.

Over the past year, SEBI has increased its vigil on social media platforms where interest of investors in the securities market get compromised on a routine basis. According to SEBI data in October 2023, India had  over 1,300 registered investment advisors catering to over 80 Mn investors. 

The size of the market also allows unregulated entities to dole out unsolicited or unverified advice on social media platforms. SEBI’s actions against unregulated financial influencers increased after social media posts related to financial advice from multiple internet influences including Ravisutanjani Kumar, Abhishek Kar and Ankur Warikoo raised major controversies

In September 2023, SEBI released a consultation paper proposing regulated entities to dissociate themselves from finfluencers. It was later reported in January that the market regulator is mulling to bring finfluencers into the regulatory net so that it becomes easy to monitor whether they are complying with the security laws. 





Source link

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We StartupNews.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It’s possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.

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