SEBI Cracks Down on SME Stock Pump-and-Dump Scheme

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AuthorAnanya Iyer|Published at:
SEBI Cracks Down on SME Stock Pump-and-Dump Scheme
Overview

India's market regulator, SEBI, has shut down a sophisticated pump-and-dump scheme involving seven individuals who allegedly manipulated 82 SME stocks. Operating through social media platforms like Telegram, WhatsApp, and X, the group is accused of making illegal profits of ₹20.25 crore. SEBI has frozen their accounts and halted trading, marking a strong stance against digital financial manipulation.

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How the Scheme Worked

The Securities and Exchange Board of India (SEBI) has issued an interim order against seven individuals, including Hemant, Rohan, and Aniket Gupta. They are accused of running a coordinated market manipulation scheme from December 2023 to January 2026. The group used a digital version of the classic pump-and-dump tactic. They bought large amounts of thinly traded Small and Medium Enterprise (SME) stocks, then promoted them with positive recommendations on X, Telegram, and WhatsApp. These messages often promised huge returns ('multibaggers') to attract retail investors. As demand increased, the group sold their shares, profiting from the inflated prices. SEBI's analysis shows the group's trading value increased by 86% during the period, and their profits surged by 242%, reaching ₹58.40 crore in total gains, with ₹20.25 crore deemed unlawful.

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Disclaimer:This content is for educational and informational purposes only and does not constitute investment, financial, or trading advice, nor a recommendation to buy or sell any securities. Readers should consult a SEBI-registered advisor before making investment decisions, as markets involve risk and past performance does not guarantee future results. The publisher and authors accept no liability for any losses. Some content may be AI-generated and may contain errors; accuracy and completeness are not guaranteed. Views expressed do not reflect the publication’s editorial stance.