Broker Platform Stock Manipulation Cases

The Securities and Exchange Board of India (Sebi) issued an interim order detailing an alleged stock manipulation network that used social media platforms including Telegram, WhatsApp, and X to artificially inflate prices of select small and medium enterprise (SME) stocks before offloading shares to retail investors.

Investigators alleged that the network executed a classic pump-and-dump scheme across 82 stocks, accumulating shares at lower prices, circulating bullish messages and earnings projections to public groups, and then selling their holdings into the resulting buying momentum to book profits.

Sebi barred seven individuals, including specific named family members, from accessing capital markets, prohibited them from offering unregistered research analyst services, and ordered the impounding of Rs 20.25 crore in alleged unlawful gains. Authorities also conducted search and seizure operations at the premises of the accused.

The regulator detailed illustrative cases, such as activities involving SME-listed Afcom Holdings, where social media promotion was allegedly coordinated with secret instructions to sell shares while public forums were being fed optimistic commentary.

Not yet reported: The final long-term judicial or market tribunal outcome and exact final penalties beyond the interim order are not reported.