With an aim to use the latest technology in its probe and oversight on stock market deals, watchdog Sebi is putting in place new software tools that would analyse discussions on social networking platforms. Besides social networking websites such as Facebook, Twitter and various blogs, the new software will also assist the regulator in analysis of traditional social neworks, which could be any forum where various people discuss matters related to stock markets.
In the recent past, a number of blogs have cropped up where their members discuss stock market trends and in many cases tips are also exchanged for buy or sell transactions. Similarly, Facebook and Twitter—two of the most famous social networking websites in—are also full of such discussions and it is feared that some scrupulous elements could be using such forums for market manipulation activities.
However, the role of new software tools, along with necessary computer hardware and high capacity servers, will not be limited to social network analysis. “Sebi is currently planning to put in place the new software tools that would perform an array of sophisticated analysis for trading data, telephone records, financial records, social network analysis etc,” a senior official said. The new tool would help Sebi in its various investigations and its oversight on stock market transactions, the official added. The regulator also aims to utilise the new software for analysis of data received from stock exchanges, depositories, banks etc in connection with its investigations.
The new software would be integrated with Sebi's Data Warehousing and Business Intelligence System (DWBIS) system that is used extensively by the regulatory in its various probes. Sebi is working on this project on a priority basis and is planning to put the new software tool in place in next few months.
There has been a sudden spurt in cases of alleged market manipulation activities and Sebi has been working overtime on its investigations in these cases. In the past also, Sebi has warned investors against websites offering stock tips. In one such investor caution notice, Sebi said that it has observed a proliferation of websites that offer investment advice to investors.
“Many of these websites offer investment advice not backed by any reasonable basis and prima facie appear to be misguiding,” Sebi said, adding that investors could expose themselves to undue risk in using unconfirmed information available on such websites and blogs.