Lok Sabha Question No. 3961 (UNSTARRED), answered on 2025-08-18
Subject: Complaints of Pump-and-Dump Activities
Ministry: FINANCE
Asked by: Shri Suresh Kumar Shetkar

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA

## UNSTARRED QUESTION NO. 3961

TO BE ANSWERED ON MONDAY, AUGUST 18, 2025/SRAVANA 27, 1947 (SAKA)

## COMPLAINTS OF PUMP-AND-DUMP ACTIVITIES 3961. Shri Suresh Kumar Shetkar:

Will the Minister of Finance be pleased to state:

- (a) the number of complaints related to suspected pump-and-dump activities received by SEBI during the last three years and the number of them resulted in regulatory action or compensation;
- (b) the  eligibility  criteria  for  retail  investors  to  seek  redress/claim  compensation  in pump-and dump frauds and whether there is any mechanism to provide interim relief to affected investors;
- (c) the details of the awareness and investor education programmes conducted by the Government,  SEBI  and  the  Investor  Education  and  Protection  Fund  Authority (IEPFA) to help investors identify and avoid pump-and-dump schemes;
- (d) whether the Government propose any amendments to existing securities laws or the SEBI Act for stronger enforcement powers against pump-and-dump operators including swift asset freezes and arrest powers; and
- (e) whether  the  Government  commit  to  publishing  annual  white  paper  or  report  in Parliament listing all pump-and-dump cases, actions taken and pending prosecutions to ensure transparency & public accountability?

## ANSWER MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

Ans(a): SEBI administers SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating  to  Securities  Market)  Regulations,  2003  (PFUTP  Regulations)  and  SEBI (Prohibition  of  Insider  Trading)  Regulations,  2015  (PIT  Regulations),  for  ensuring protection  of  investors'  interest.  The  number  of  investor  complaints  related  to suspected pump-and-dump activities received by SEBI during the last three financial years is as under:

| Year       |   No. of investor complaints received by SEBI |
|------------|-----------------------------------------------|
| FY 2022-23 |                                            34 |
| FY 2023-24 |                                            41 |
| FY 2024-25 |                                            25 |

During the period, April 2020 to March 2025, SEBI levied penalty for INR 1860.03 Crores and has passed directions of disgorgement of unlawful gains for INR 452.60 Crores under SEBI (PFUTP) Regulations, 2003.

Ans(b): Under the SEBI (Investor Protection and Education Fund) Regulations, 2009, disgorged amounts are credited to the Investor Protection and Education Fund, from which  SEBI  may  restitute  funds  to  identifiable  investors  who  suffered  losses  from securities law violations.

Ans(c):  SEBI  and  the  Investor  Education  and  Protection  Fund  Authority  (IEPFA), undertake  extensive  investor  education  and  awareness  initiatives  to  safeguard investors' interests in the securities market.

1. Between FY 2019-20 and FY 2024-25, IEPFA, along with various organisations, conducted over 71,000 investor  awareness  programmes nationwide promoting prudent financial practices such as saving, budgeting, and investing, while cautioning investors against fraudulent activities.
2. SEBI, in co-ordination with stock exchanges and depositories, also carries out regular investor education and awareness programs across the country. These free of cost programs, inter-alia, cover various topics such as basic investing principles, investor rights and responsibilities, common features of investment scams  such  as  pump-and-dump  schemes,  fake  trading  apps,  unregistered investment advice via social media platforms and other channels, social media experts giving stock tips, deepfake videos of public figures, paid trading courses with guaranteed return promises, impersonation of SEBI officials and intermediaries and unsolicited tips promising unrealistic or guaranteed returns.
3. SEBI  in  collaboration  with  Market  Infrastructure  Institutions  (MIIs)  runs  a dedicated campaign on 'Fraud and Scam Prevention in the Securities Market', sharing  tips  to  avoid  investment  scams,  healthy  digital  practices  etc.  The campaign is widely disseminated through digital media.
4. In  FY  2024-25  SEBI,  along  with  MIIs,  Association  of  Mutual  Funds  in  India (AMFI)  and  Asset  Management  Companies  (AMC),  conducted  investor awareness programs in 724 districts across 36 States and Union Territories, covering nearly 32 lakh investors. SEBI has also launched the Saa₹thi Mobile App, readily offering educational resources and investment information.

Ans (d) and (e): SEBI has put in place regulatory and surveillance frameworks for effecting stable operations and development of the securities markets. Surveillance systems generate a variety of alerts indicating possible instances of insider trading, front running, price-volume manipulation, and other irregularities. Such alerts, along with investor complaints, serve as inputs for detailed examinations, on the basis of which SEBI conducts investigations and takes enforcement action under the SEBI Act, 1992. For violations such as pump-and-dump schemes or other fraudulent activities, SEBI may impose measures including debarment of entities for specified periods, levy of  penalties,  and  disgorgement  of  wrongful  gains,  as  provided  under  the  SEBI Act,1992 and related regulations.