SEBI Tightens Digital Advertising Norms For Registered Entities

With an eye on curbing the rising online frauds in the securities market, the Securities and Exchange Board of India (SEBI) has now tightened digital advertising rules for its registered intermediaries. 

In an advisory dated today, the market regulator said that all its registered intermediaries will now have to verify their identity before posting ads online. As part of this, entities will be mandated to register on social media platforms using their SEBI-registered email addresses and mobile numbers. 

Subsequently, social media platforms will be required to carry out the verification of the applicants, and only then will the registered intermediaries be allowed to post ads on such platforms. 

“… It has been decided in consultation with Social  Media Platform Providers  (SMPPs) that all SEBI registered intermediaries uploading/ publishing advertisements on SMPPs like Google/ Meta  (to start with), shall be required to register on such social media platforms using their email ids and mobile numbers registered on SEBI SI Portal,” read the advisory. 

SEBI also directed the registered entities to update their contact details on the regulator’s intermediary database (SEBI SI Portal) by April 30, 2025. 

The advisory noted that the mandates have been instituted to curb the increasing number of frauds related to the securities market on platforms such as YouTube, Facebook, Instagram, WhatsApp,X (previously Twitter), Telegram, Google Play Store, Apple Store, among others. 

The regulator added that fraudsters were enticing victims online by offering services such as online trading courses, seminars, “deceptive” testimonials, and “guarantee of assured or risk-free return” via social media platforms. It is this that SEBI wants to curb with the advisory.

The latest update comes as India continues to see a spurt in cyber fraud cases. For instance, the Indian government recently noted that Indians lost INR 1,935.51 Cr to digital arrest scams in 2024 alone.   

Meanwhile in the first two months of 2025, about 17,718 incidents of digital arrest scams were reported which defrauded the Indian public of INR 210.21 Cr. 

Meanwhile, the Centre has blocked more than 7.81 Lakh SIM cards and 2.08 Lakh IMEI numbers, as of February 28, 2025, in response to  the digital arrest complaints from various authorities. 

As if this was not enough, Minister of State (MoS) for Finance Pankaj Chaudhary informed the Lok Sabha earlier this month that Indians lost an additional INR 107.21 Cr to cyber frauds in the first nine months of the ongoing financial year 2024-25 (FY25).

The latest update comes on the same day as SEBI allowed startup founders to hold employee stock options (ESOPs) even after their company goes public.