Sebi should issue a stern code to curb corrupt financial journalism

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₹1 crore. This penalty was imposed for his alleged involvement in front-running. The anchor allegedly used material non-public information to benefit from stock trades before it was broadcast.

Sebi found that wrongful gains were made by a few who had advance access to that information. “When TV anchors engage in sharing material non-public information, as noted in this case, it not only breaches ethical standards but also distorts market dynamics… This erosion of trust can lead to a significant loss of confidence among investors, who may feel that the markets are rigged against them," Sebi’s order stated. The market regulator’s crackdown on unethical financial reporting practices is not the first of its kind.

In 2022, it had passed an order against another CNBC Awaaz news anchor, Hemant Ghai, and his wife for wrongfully profiting from information that was not yet in the public domain. In this case, he allegedly bought stocks in his wife’s and mother’s names before airing the news so as to profit from an anticipated rise in prices. These cases highlight glaring ethical and legal issues in the realm of Indian financial journalism.

We need specific regulations: The current framework governing financial journalists comprises Sebi (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations of 2003, or PFUTPR for short, and the Sebi (Research Analysts) Regulations of 2014 (RA regulations). As these two sets of rules were primarily designed to govern market intermediaries and research analysts, they did not take into account the nuanced roles and potential conflicts-of-interest of others like financial reporters/journalists. This lack of specificity has given rise to regulatory gaps and