SEBI Issues Advisory on Unauthorised Virtual Gaming Platforms

The Securities and Exchange Board of India (SEBI) has issued an advisory guiding investors not to engage in trading activities through un-registered intermediaries/web applications/platforms/apps. Entities offering virtual trading services or paper trading or fantasy games to the public based on stock price data of listed companies are in violation of Securities Contract (Regulation) Act, 1956 and SEBI Act, 1992.

Investors engaging in these activities including sharing of confidential and personal trading data would do so at their own risk and will not be protected under SEBI/Exchange(s) Jurisdiction including SCORES, investor grievance redressal mechanism or the online dispute resolution mechanism administered by Exchanges/Depositories (smartodr.in).

SEBI had issued a similar circular in 2016. In addition, a circular with norms for sharing of real time price data to third parties was also shared in May this year whereby Market Infrastructure Institutions (MIIs) and registered market intermediaries were directed not to share real time price data with any third party.