In its advisory, SEBI raised alarm over the growing menace of online platforms offering fantasy games to the public based on stock trading data of listed companies
The regulator also said that users undertaking transactions on these illegitimate platforms would do so at their own “risk, cost and consequences”
In 2016, SEBI issued a circular that banned leagues and competitions, involving prize money, related to securities markets
Markets regulator Securities and Exchange Board of India (SEBI) on Monday (November 4) cautioned the public against unauthorised online virtual trading and gaming platforms.
In its advisory, SEBI raised alarm over the growing menace of online platforms offering fantasy games to the public based on stock trading data of listed companies. Advising the general public to not engage with such sites, the regulator added that users undertaking transactions on these illegitimate platforms would do so at their own “risk, cost and consequences”.
“Participation in unauthorised schemes, including sharing of confidential and personal trading data, is at the investors’ own risk, cost and consequences, as such schemes/ platforms are not registered with SEBI. SEBI is issuing this caution, advising investors to not engage with or undertake investment or trading activities through unregistered intermediaries/ web applications/ platforms/ apps,” read the advisory.
Calling on the investors to only invest in securities markets via registered platforms, the regulator added that such fantasy gaming and virtual trading platforms violate the Securities Contract (Regulation) Act, 1956 and SEBI Act, 1992.
The advisory also noted that users of such sites would not be able to avail any investor protection benefits from the regulator’s existing grievance redressal and dispute resolution mechanisms.
Notably, this is not the first time that SEBI has flagged such platforms. Back in 2016, it issued a circular that banned leagues and competitions, involving prize money, related to securities markets.
The directions come at a time when the central government has actively cracked the whip on illegal online betting platforms that lure users with promises of high returns and prizes.
In August this year, reports surfaced that the Enforcement Directorate (ED) was probing more than two dozen offshore gaming platforms for remitting and round-tripping funds. In March, the Ministry of Information and Broadcasting (MIB) banned social media influencers from promoting or advertising offshore online betting and gambling platforms.
Earlier this year, instant messaging platform Telegram, too, was being scrutinised by the Indian government over allegations of extortion and gambling.
By Inc42 Media
Source: Inc42 Media