Fraudsters may find ways around Sebi's misleading ad rules

The market regulator's advisory directing only verified intermediaries to publish advertisements on social media may not fully control the menace of misleading claims as fraudsters could still exploit loopholes, according to experts.

- Neha Joshi

Despite the efforts by the Securities and Exchange Board of India (Sebi), fraudsters can still find ways to bypass regulations by setting up anonymous or offshore entities to operate outside the regulator's jurisdiction, said Zubin Morris, a partner at law firm Little & Co.

"Some may misuse influencer marketing, where individuals indirectly promote unregulated investment schemes without directly violating Sebi's rules," said Morris. "Fake testimonials, exaggerated investment returns, and unofficial online investment groups remain major concerns, as they can still mislead investors."