By Aglaia Staff

Popular messaging app, WhatsApp, which is being acquired by Facebook, is under the Sebi scanner along with other instant messaging platforms such as BlackBerry Messenger and Facebook chat for being used to spread price-sensitive information about stocks. 

“Sebi plans to take stringent action to check the risks of new smartphone messaging services,” said a regulatory source. 

Traders, possibly working as a cartel, are using these platforms for insider trading, front running 

and other manipulative activities, said market sources.

For instance, a market operator buys a stock and then leaks price-sensitive information about it on instant messaging and social media platforms, leading to the stock running up sharply, at which point the operator exits his positions with huge profits.

Stock brokers and fund managers are prohibited from using mobile phones inside dealing rooms to receive orders from clients and fund 

to receive orders from clients and fund houses and brokerage firms are required to maintain client call records for inspection by Sebi.

But many brokers and money managers have been found to be active on social messaging platforms and other Web-based groups while placing orders, market sources said.

Globally, some of the leading banks and financial institutions are clamping down on use of such platforms inside the dealing rooms.




 Whatsapp, BBM, FB Chat Under SEBI Scanner
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