Sebi is turning to artificial intelligence to keep a closer watch on financial influencers and fraudulent investment content on social media, as its latest investor survey shows that a large majority of investors are influenced by finfluencers.
The market regulator has operationalised Project SUDARSAN, an AI-powered surveillance platform designed to monitor unauthorised digital activity and detect content that could mislead investors.
Sebi’s latest Investor Survey found that 62% of investors are influenced by finfluencers. The regulator has flagged the lack of accountability and verified performance data among many such influencers as a concern, particularly when investors rely on their content to make financial decisions.
HOW SEBI IS USING AI TO WATCH FINFLUENCERS
Project SUDARSAN, which stands for Surveillance of Unauthorised Digital Activity via Real-time Scanner for Anti-fraud, is an AI-powered intelligence platform that Sebi has developed to move from conventional monitoring to more proactive surveillance.
The system uses what Sebi describes as advanced multimodal AI. That means it can analyse different forms of information at the same time, including spoken language, visual cues and contextual intent. It can also analyse content in regional languages.
The system combines these signals with behavioural and regulatory parameters and assigns risk scores to the content it identifies. It then generates structured alerts that can be examined for possible regulatory action.
This is significant because financial fraud on social media does not always appear as a straightforward written recommendation. A video, an image, an advertisement or a message can all be used to make claims about investments.
SUDARSAN is therefore designed to continuously scan public content across major social media platforms, including videos, messages, images and advertisements.
Sebi says the system has specifically been engineered to identify deceptive practices such as guaranteed-return claims, fraudulent certifications, impersonation of regulated entities and the provision of unregistered investment advice.
FROM GUARANTEED RETURNS TO FAKE CERTIFICATIONS
One of the biggest risks for retail investors is that financial content on social media can look credible even when the person behind it is not authorised to provide investment advice.
A post promising guaranteed returns, for example, can be presented as an investment opportunity rather than an obvious scam. Similarly, someone can use fake credentials or impersonate a regulated entity to create the impression that the advice or investment product is legitimate.
SUDARSAN is designed to look for precisely these kinds of signals.
The system does not only search for particular words. Sebi says it analyses spoken language, visual cues and contextual intent, while also using behavioural and regulatory parameters to generate risk scores. This allows the regulator to move towards automated identification of potentially suspicious content rather than depending entirely on manual monitoring.
SEBI HAS ALREADY FLAGGED MORE THAN 20,000 INSTANCES
The scale of the monitoring is already significant.
Sebi said that since Project SUDARSAN began in November 2025, it has identified more than 20,000 instances of fraudulent content and posts across social media.
The regulator said the system has also helped reduce the burden of manual oversight while strengthening its ability to monitor digital activity that could undermine market integrity.
The number is particularly significant when viewed against the rapid expansion of retail participation in the securities market and the growing role of social media in how investors discover financial information.
SEBI IS ALSO TRYING TO STOP UNAUTHORISED ADS
SUDARSAN is not Sebi’s only technology-based intervention.
The regulator has also implemented an API-based framework in collaboration with social media platform providers so that advertisements related to the securities market can be run only by verified, Sebi-registered intermediaries.
This creates another layer of screening. While SUDARSAN focuses on identifying suspicious public content, the advertising framework is aimed at preventing unauthorised entities from using social media platforms to promote securities-market related advertisements in the first place.
Sebi has also deployed R(AI)DAR, an AI-powered monitoring and enforcement support tool for asset management companies. The system reviews advertisements and investor education material and can identify compliance issues, including products being promoted in the guise of educational content and missing mandatory disclaimers.
Together, these systems show how Sebi is increasingly using technology not just after a complaint is received, but to identify potentially problematic content before it reaches or misleads more investors.
WHY SEBI IS WORRIED ABOUT FINFLUENCERS
The concern is not simply that people are consuming financial content on social media.
The bigger issue is what happens when investors treat that content as investment advice without knowing whether the person giving it is regulated, whether the performance claims can be verified or whether the risks have been properly disclosed.
Sebi’s own report points to this information gap. It says the 62% finding on finfluencer influence highlights the risks posed by people operating without accountability or verified performance data.
The regulator is therefore building multiple layers of protection around the investor.
Alongside surveillance, Sebi has introduced the Sebi Check facility and validated UPI handles to help investors verify whether they are making payments to genuine Sebi-registered intermediaries. It has also partnered with Google Play on a verified app label initiative aimed at helping investors identify legitimate stock-trading apps.
The idea is to make it harder for an investor to be misled at different points — from discovering an investment idea on social media to downloading an app and finally transferring money.
BIGGER PROBLEM IS THAT PEOPLE ARE LISTENING
The 62% figure becomes more important when viewed alongside Sebi’s wider Investor Survey.
The survey covered more than 90,000 households across urban and rural India and examined how people move from awareness of securities products to actual participation.
It found that 63% of Indian households, or approximately 213 million households, are aware of at least one securities product, including mutual funds, shares and bonds. But only 9.5%, or around 32.1 million households, actually invest in these markets.
That means there is a large pool of Indians who know that these investment products exist but have not yet started investing.
The survey found that 74% of non-investors cite the complexity of products and a lack of understanding as barriers. Another 73% are concerned about potential losses, while 51% have low trust in financial institutions and transparency.
This creates a natural opening for social media creators. People who find traditional financial products difficult to understand may turn to short videos, social media posts and influencers for simpler explanations.
Sebi’s survey found that 80% of respondents preferred short-form videos as a way of learning, while 69% preferred social media. Regional languages were also in strong demand, with 47% preferring regional-language content and another 47% preferring Hindi.
That makes the influence of finfluencers a much bigger issue than just social-media chatter. For a large number of potential investors, these platforms are becoming part of the route through which they learn about investing.
And Sebi’s challenge is to ensure that the information reaching those investors is not only easy to understand, but also accurate, transparent and legally compliant.
