SEBI Bans Actor Arshad Warsi, 58 Others from Securities Markets
The Securities and Exchange Board of India (SEBI) has issued market bans ranging from one to five years against 59 individuals, including actor Arshad Warsi, his wife Maria Goretti, and several social media influencers. The penalties stem from a large-scale manipulation scheme involving Sadhna Broadcast Ltd (now renamed Crystal Business System Ltd).
Warsi and Goretti have also been fined ₹5 lakh each. SEBI ordered them to return profits of ₹41.70 lakh and ₹50.35 lakh, respectively, which were gained through the pump-and-dump operation. In total, the regulator has directed all 59 entities to disgorge ₹58.01 crore along with 12% interest annually from January 1, 2023.
How the Stock Manipulation Unfolded
SEBI’s investigation found that the fraud was carried out in two key phases:
- Phase 1: Entities connected to the promoters of Sadhna Broadcast artificially inflated the stock price by executing synchronized trades among themselves. This created a false sense of trading volume and investor interest.
- Phase 2: Once the stock price was sufficiently inflated, promotional YouTube videos were released via channels such as Moneywise, The Advisor, and Profit Yatra. These videos claimed that Sadhna Broadcast had received a ₹1,100 crore U.S. deal, a 5G spectrum license, and was about to be acquired by the Adani Group—all of which were false.
These misleading videos drew in retail investors, who purchased the overvalued stock, allowing the manipulators to exit their positions at a profit.
Key Individuals Behind the Scam
SEBI named Gaurav Gupta, Rakesh Kumar Gupta, and Manish Mishra as the principal architects of the scheme. Mishra was reportedly responsible for creating and distributing the deceptive YouTube content. Subhash Aggarwal, a director at the registrar and transfer agent of Sadhna Broadcast, facilitated connections between the scheme’s masterminds and company insiders.
Other individuals including Peeyush Agarwal, Lokesh Shah, and Jatin Shah were also found guilty of coordinated trading and aiding in the dissemination of misleading information. SEBI concluded that this group operated in a concerted fashion to defraud ordinary investors and manipulate market sentiment.
Regulatory Impact and Market Message
This case highlights a growing trend of using YouTube and social media to influence investor behavior. SEBI’s aggressive enforcement in this case is a warning to both market participants and content creators that deceptive promotions and coordinated manipulation will be met with strict penalties.
By holding public figures accountable, including celebrities and online influencers, SEBI aims to restore confidence in market transparency and ensure retail investors are protected from misinformation and exploitation.
