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SEBI ban actor Arshad Warsi for misleading videos

SEBI ban actor Arshad Warsi for misleading videos

SEBI ban actor Arshad Warsi for misleading videos

SEBI ban actor Arshad Warsi for misleading videos

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  • In cases involving the manipulation of the share prices of two companies.
  • Two other interim decisions state that in addition to the market ban.
  • These organizations have been categorized by SEBI into groups.
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In cases involving the manipulation of the share prices of two companies through the uploading of deceptive videos on YouTube channels, the Securities and Exchange Board of India (SEBI) on Thursday barred 45 entities from the securities market, including actor Arshad Warsi, his wife Maria Goretti, and others.

The cases concern posting deceptive YouTube videos and encouraging investors to purchase shares of Sadhna Broadcast Ltd. and Sharpline Broadcast Ltd.

Other than the couple, a few of Sadhna Broadcast’s promoters have been prohibited from participating in the stock market due to their involvement.

Two other interim decisions state that in addition to the market ban, the regulator has seized illicit earnings totaling Rs 54 crore made by the firms as a result of deceptive movies being posted on YouTube channels.

Arshad Warsi and his wife received a combined profit of Rs. 37.56 lacks in the case of Sadhna Broadcast, according to SEBI. Iqbal Hussain Warsi has also made a profit of Rs. 9.34 lakh. The capital markets regulator has designated these three and other entities as volume creators.

The two orders were issued after SEBI received complaints alleging that some entities had manipulated share prices and sold shares of the television channel Sadhna Broadcast and New Delhi-based Sharpline Broadcast.

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According to the complaints, fraudulent YouTube videos with deceptive information about the two companies were produced in an effort to entice investors.

After that, the regulator carried out an investigation between April and September 2022 and discovered that the two companies scrip prices and volumes spiked between April and mid-July 2022.

False and deceptive films concerning Sadhna were posted on the Adviser and Moneywise YouTube channels in the second half of July 2022.

In the second half of May of last year, videos about Sharpline were also posted on the Midcap calls and Profit Yatra YouTube channels.

According to Sebi’s two separate interim decisions, these YouTube videos spread incorrect and deceptive information to encourage investors to purchase shares of Sadhna and Sharpline in order to make enormous profits.

The price and trading volume of the scrip of the two corporations increased after the publication of the deceptive YouTube videos. The volumes appear to have come from a sizable number of retail investors who were probably swayed by the deceptive YouTube films.

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Several promoter shareholders, important Sadhna management figures, and non-promoter shareholders sold a sizeable portion of their shareholding during this time at inflated prices and earned gains.

One of the false movies on these YouTube channels claimed that the Adani Group would acquire Sadhna Broadcast Ltd and that the company’s margins would rise as a result of the merger.

There were also other videos, including one in which it appears that businessman Gautam Adani can be seen. The company is transitioning from TV production to film production, and a large American corporation has signed a contract for Rs 1,100 crore to make four devotional films. The money will come from the American investor, but the rights will remain with Sadhna.

These organizations have been categorized by SEBI into groups such as information carriers, net sellers/promoters and profit makers (NSs), and Manish Mishra, a YouTube channel creator (ICs).

The PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) rules were ostensibly broken, according to SEBI, which noted that these entities collectively helped generate trading volumes and interest in the scrip, spread false and misleading YouTube videos, and thus persuaded investors to purchase the companies’ stock at inflated prices.

In the case of Sadhna, SEBI claimed that the complex business practices used by the notice entities, including the flagrant abuse of obviously false and deceptive YouTube videos, had resulted in a sharp rise in the number of small shareholders, from 2,167 to 55,343 shareholders, who ultimately purchased shares from the notice net sellers and volume creators at inflated prices. In the case of Sharpline, the number of small shareholders increased from 517 to 20,009 shareholders.

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As a result, the regulator has prohibited these 45 businesses “from buying, selling or dealing in securities either directly or indirectly, in any form whatever, until further instructions”. In both instances, several of these organizations were involved.

Also, until the seized funds are deposited in the escrow account, all entities have been instructed not to sell any assets, whether movable or immovable, including money in bank accounts, without first obtaining approval from Sebi.

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