Sebi conducts search and seizure at 2 locations in Gujarat

The entities were allegedly operating a Telegram channel with significant number of subscribers

Markets regulator Sebi on Wednesday conducted searches at premises of certain entities, who were allegedly operating a social media channel, and seized documents, mobiles and laptops, sources said.

The search and seizure operation was carried out at two locations -- Ahmedabad and Mehsana -- on three entities in Gujarat who were allegedly operating a Telegram channel with significant number of subscribers, they added.

According to people familiar with the matter, these entities were building position in the market prior to giving recommendations in scrips through the channel operated by them.

Subsequently, they squared off their positions and thereby allegedly made illegal gains at the expense of gullible investors, they added.

Detailed investigation is in progress in the matter, said a senior official.

During the search operation, Sebi officials seized electronic and digital devices.

Under the Sebi Act, the regulator has the power to carry out search and seizure of books, registers, documents including electronics and digital devices from any person associated with the securities market.

The Securities and Exchange Board of India (Sebi) had carried out a similar exercise in 2017 in a matter related to circulation of messages through WhatsApp.

The regulator has been cautioning the investors from time to time regarding circulation of messages giving unsolicited stock tips or investment advice through bulk SMSs/ websites/social media platform.