By IndiaHub 
However, the Gensol episode is yet another wake-up call—even for those who didn’t invest in it. Acting on social media tips without verifying the facts can land investors in a trap. While some influencers may unknowingly promote dubious stocks, others do so with clear intent.
Also read | Fake finfluencers misleading common man: What is SEBI doing to rein in the menace and is it enough?
“Many are paid to create hype as part of pump-and-dump operations. They don’t gain from the stock’s performance. Their earnings come from promotional fees, while the real operators quietly exit, leaving retail investors exposed,” says Piyush Singh, a stock trading expert who documented the finfluencers saga at Gensol in detail after the Securities and Exchange Board of India (Sebi) probe was revealed.
Lack of transparency
A 20 March 2025 survey by the CFA Institute reveals that 59% of Indian finfluencers have had one or more brand sponsorships yet 63% of them failed to disclose their financial affiliations. The findings are based on a poll of 1,615 retail investors and a content review of 51 finfluencers.
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This lack of transparency makes it difficult to distinguish between genuine advice and paid promotions. “Don’t invest in stocks unless you know how to analyse them fundamentally,” cautions Singh.
Anurag Rawat
Data analyst
Invested Rs.2 lakh in Tejas Networks when the share price was Rs.1,150. Now his investments are down a third of the amount invested.
Influenced by Grandmaster of stock (X@adeptmarket)
The Gensol incident is a mere drop in the bucket. In 2022, a similar case emerged with crypto platform Vauld, heavily promoted by finfluencers; the platform later blocked withdrawals, leaving many investors stranded. Yet, such incidents rarely prompt caution until investors suffer losses firsthand.
Meet Delhi-based data professional, Anurag Rawat. He invested Rs.2 lakh in Tejas Networks at Rs.1,150 per share, following a recommendation from a finfluencer on X known as Grandmaster of stock @Adept Market. Today, the stock trades at Rs.742; a fall of nearly 36% below his purchase price. “It was hard to even save that money since I had just started working,” Rawat laments.
He had clearly ignored the disclaimer in the influencer’s bio — ‘not Sebi-registered’ and ‘only for educational purposes.’ Like many new investors, Rawat hoped to strike it big. Now he is more cautious. “I don’t rely on anyone’s advice on social media anymore. I stick to credible news sources and registered advisers,” he adds.
Rawat’s experience is not unique. Nearly 17% of investors admitted to losing money by following influencer advice as per the CFA institute survey. It’s tempting to believe you won’t fall into this category — until you do.
Some investors are even more vulnerable, falling for advice that doesn’t even come from well-known sources. Hyderabad-based Sandeep Shukla, for instance, invested Rs.2.5 lakh from his father’s Provident Fund (PF) and savings after receiving a direct message on Instagram from an unknown user promoting a Telegram channel with daily stock trading tips.
“I had made the worst decision of my life. While I made small profits at first, I eventually lost everything,” he says. This shows that the danger doesn’t only lie in blindly following well-known influencers, but also in trusting financial tips from unverified sources on social media.
Capital market regulator Sebi has warned investors many times to stay away from unregistered advisers, including the latest advisory issued on 21 May, cautioning the public about fake profiles impersonating celebrities, public figures and Sebi-registered entities. In Shukla’s case, it wasn’t a finfluencer who misled him, it was his lack of awareness.He is now financially literate. Investors’ greed also plays a part.
Spot the lies
If you see a finfluencer following any of these practices, RUN!
Lack of verifiable reasons behind stock tips Any stock recommendation should come with clear, verifiable reasons— something that can be cross-checked by the public.
Unrealistic price predictions Setting an impossible target, like `2,500 for a stock currently priced at `300, is a warning sign.
No recordkeeping or accountability Unregulated influencers often don’t track their advice. They delete posts after a week and vanish without a trace.
Demeaning competitors to push own service Watch out if they run down others while promoting their own offerings, saying “do it yourself” and “buy my course.”
Misleading promotions with hidden agendas If they push you to join an Insta or Telegram group that leads to losses, beware—it could be part of a hidden agenda.
Selling unconventional or risky assets Avoid investments you do not understand. Also, if it’s too good to be true, it is indeed too good to be true.
Undisclosed financial ties or promotional strategies Be cautious of influencers who offer paid trading tips—it’s often a tactic designed to lead you to losses.
Who’s most at risk?
A mix of low financial literacy and the lure of quick money often draws young investors to unverified online advice. The CFA survey shows those aged between 26-30 are most likely to seek guidance on YouTube and Instagram. Traditional advice can feel intimidating, while finfluencers use relatable language, memes, and reels to simplify things. Investors should be cautious. Bold claims that a stock will ‘skyrocket’ without solid reasoning are red flags. Many such voices are either pushing paid courses, promoting companies for a fee, or building a personal brand without real expertise. Some also earn commissions through broker tieups when investors buy stocks they endorse.
Their reckless advice extends beyond stocks. During the crypto boom, many finfluencers hyped it up. In 2022, Jaipur student Gaurav Sharma invested Rs.60,000 after watching finfluencer Akshat Shrivastava praise crypto returns. A few months later, market volatility wiped it all out. ET Wealth reached out to Shrivastava through LinkedIn, email, and X but didn’t receive a response.
Sandeep Shukla
Equity research analyst
Fell victim to a Telegram channel that provided stock market trading tips. He invested Rs.2.5 lakh from his father’s PF and savings account and lost all of that in a matter of days.
Influenced by Unknown trader
“That’s when I decided never to act on online advice blindly. I turned to a registered professional instead,” says Sharma, who consulted certified financial planner Anish Aggarwal. “He helped me understand the value of SIPs and long-term investing.” Sharma now sticks to the mutual funds route building wealth in a sustainable way.
Be selective in trusting
With financial advice flooding the internet, identifying who to trust can be overwhelming. Some finfluencers genuinely aim to simplify money matters and guide investors towards better decision-making. For instance, Pranjal Kamra, a well-known finfluencer is also a Sebi-registered investment adviser. “We do not deal in intraday trading, currency or commodity futures and options, or individual stocks. Even morally, it’s risky to recommend volatile assets on social media — viewers may see a buy call but miss the later sell, creating a communication gap,” he says.
Knowing how to separate the helpful from the harmful is critical. Look for educators or channels who focus on long-term financial behaviour, not shortcuts or quick wins. Finfluencers selling courses, naming specific stocks, or pushing ‘get-rich-quick’ strategies should raise red flags
Most importantly, check credentials. Stick to advisers registered with Sebi — it’s easy to verify this on its website by searching for their name or registration number in the intermediary directory. This will help you filter out the noise because of the 51 Indian finfluencers surveyed by the CFA Institute, only 2% were Sebi-registered. These licensed advisers are bound by professional standards and can be held accountable for misinformation or unethical promotion.
Gaurav Sharma
Student
Invested Rs.60,000 in crypto through Vauld due to the promise of high returns but ended up losing it all. Even if he hadn’t suffered a loss, he would have lost his money due to the Vauld scam.
Influenced by Akshat Shrivastava
Regulating advice
Sebi is already taking steps to rein in unregulated finfluencers (See Clickbait to crackdown, P4), such as restricting the use of live market data by those offering trading tips under the guise of education. “Sebi’s move to bring unregulated advisers under the regulatory framework is commendable, but there’s still a long way to go. Several loopholes remain,” says Anand K. Rathi, Co-founder, MIRA Money.
Peeyush Chitlangia, Founder of FinShiksha, echoes the need for regulatory clarity. “It’s tough to monitor everything shared on social media. Sebi should also focus on building awareness among content consumers so that they can distinguish between credible and dubious advice,” he says.
Finally, financial awareness is the strongest defence. If you’re consuming content online, you are responsible for evaluating it critically. Recognise your own psychological biases like fear of missing out or greed and pause before following any advice or a random channel. In the age of content overload, financial caution is essential.
Remember: if you find yourself often relying on finfluencers for guidance, or worse, tips from social media or through Telegram channels you are a part of, then you need the help of a Sebi-registered investment adviser or a good mutual fund distributor, both with a good track record.
MISLEADING FOR LIKES
How financial advice on social media went wrong for investors.
Vauld crypto platform (2022)
This Singapore-based crypto lending platform suspended operations in July 2022, leaving investors in limbo. Finfluencers such as Ankur Warikoo—who earned `4.47 lakh for promoting it—were associated with the brand. “It is the responsibility of every creator to have skin in the game because talk is cheap,” Warikoo later told a newspaper.
Baap of Chart (2023)
Nasiruddin Ansari positioned himself as a stock market expert, enticing investors with promises of guaranteed returns of at least Rs.3 lakh and offering multiple stock tips. Sebi later banned him and imposed a hefty fine of Rs.17.2 crore.
Sadhna Broadcast (2023)
Stock prices of Sadhna and Sharpline Broadcast were artificially inflated through misleading YouTube channels—“The Advisor” and “Moneywise”—run by Manish Mishra. Sebi barred Mishra from the securities market for allegedly deceiving investors.
She-Wolf of the Stock Market (2025)
Many aspiring traders lost money to this. Sebi cracked down on Asmita Patel for running an unregistered investment advisory under the guise of an education program, charging students Rs.7 lakh for a course promising market mastery.