SEBI CAUTIONS INVESTORS
A. LEAGUES / SCHEMES / COMPETITIONS WHICH MAY INVOLVE DISTRIBUTION OF PRIZE MONIES
It has come to the notice of SEBI that various entities are soliciting investors by offering leagues/schemes/competitions etc. related to securities markets. Some of the schemes may involve distribution of prize monies. Participation in such schemes including sharing of confidential and personal trading data is at investors’ own risk, cost and consequences as such schemes are neither approved nor endorsed by SEBI / SEBI recognized Exchange(s).
SEBI is issuing this caution to investors to warn about such schemes offered by third party or group company/associate of stock broker(s) etc. The investors may note that for any kind of disputes relating to such schemes or enforcement of any agreement / MoU, etc., none of the following recourses will be available to investors of such schemes:
1. Benefits of investor protection under SEBI/ Exchange(s) Jurisdiction
2. Exchange dispute resolution mechanism
3. Investor grievance redressal mechanism administered by Exchange(s)
B. UNAUTHORIZED ELECTRONIC PLATFORMS
It has also come to the notice of SEBI that certain electronic platforms are facilitating fund raising on digital platforms like websites and other internet platforms, which are similar to the platforms of stock exchanges. These digital platforms are neither authorized nor recognized under any law governing the securities market. The electronic platforms are allegedly facilitating investment in the form of private placement with companies, as the offer is open to all the investors registered with the platform amounting to a contravention of the provisions of Securities Contract (Regulation) Act, 1956 (SCRA) and the Companies Act, 2013. Only recognized stock exchanges provide a platform where equity and other securities issued by companies are listed and traded in accordance with the provisions of the SCRA. The details of SEBI recognized stock exchanges are available on the SEBI website www.sebi.gov.in.
Investors are hereby cautioned that all dealings on such unauthorized electronic platforms would be in contravention of the relevant securities laws.
C. DEALING WITH UN-REGISTERED INVESTMENT ADVISERS AND RESEARCH ANALYSTS
The general public should not trade in the securities markets based on the tips/recommendations provided by unregistered investment advisers / research analysts and should not get attracted or lured by such trading tips and stock specific recommendations received through Short Message Services (SMSs)or through any public media including websites or through any other social networking media. The public in general are advised to check the registration status of the entity/person on the SEBI website before availing the investment advisory services/ research services.
Investors are advised to deal with SEBI registered entities whose details are available on the SEBI website (www.sebi.gov.in).