SEBI’s Project Sudarsan flags 20,000 fraudulent posts as 62% of investors are influenced by finfluencers

The Securities and Exchange Board of India (SEBI) is increasingly turning to artificial intelligence to monitor misleading and fraudulent financial content online, as the regulator faces a growing challenge from unregistered finfluencers influencing retail investors.

Since its launch in November 2025, SEBI’s Project SUDARSAN has identified more than 20,000 instances of fraudulent content and posts across social media, according to the regulator’s Annual Report 2025-26.

The AI-powered platform is part of SEBI’s broader technology-led approach to market surveillance. Chairman Tuhin Kanta Pandey said the growing influence of financial influencers has made such digital monitoring increasingly important.

“This digital vigilance is further necessitated by our latest Investor Survey, which revealed that 62% of investors are influenced by finfluencers – many of whom operate without accountability or verified performance data,” Pandey said.

How Project SUDARSAN detects fraudulent financial content

Project SUDARSAN, or Surveillance of Unauthorized Digital Activity via Real-time Scanner for Anti-fraud, is designed to continuously monitor publicly available content across social media platforms.

The platform uses multimodal artificial intelligence to analyse different forms of content, including spoken language, images, videos and text. It can also assess contextual intent and process content in regional languages.

SEBI said the system combines these signals with behavioural and regulatory parameters to assign risk scores to potentially suspicious content. It then generates structured alerts that can be reviewed by the regulator.

The system is designed to detect practices such as claims of guaranteed returns, fraudulent certifications, impersonation of regulated entities and investment advice being offered without the required registration.

The technology represents a shift from manual and reactive surveillance towards automated, real-time monitoring. This allows SEBI to scan a much larger volume of social media content than would be possible through conventional oversight alone.

SEBI has also deployed R(AI)DAR, an AI-enabled system that reviews advertisements issued by market participants and helps identify potentially misleading or unauthorised promotional content.

Why SEBI is stepping up finfluencer surveillance

The need for such surveillance has grown alongside the influence of financial creators on investment decisions.

SEBI’s Investor Survey 2025 found that 62% of investors make some investment decisions based on finfluencer recommendations. The survey also found that 93% of respondents considered financial influencers moderately to highly credible.

YouTube was the most-used social media platform for information on securities-market products, cited by 91% of respondents, followed by Instagram at 64% and Facebook at 61%.

For SEBI, the challenge is therefore not simply the volume of financial content online, but the extent to which investors trust and act on it.

Pandey said technology and data analytics are now becoming core components of the regulator’s supervisory framework.

“SEBI has responded to this shift by investing in technology and data analytics as core supervisory tools, ensuring that while the market scales, the safety net for the investor scales even faster,” he said.

The regulator is also using measures such as validated UPI handles, SEBI Check and verified app labels to help investors distinguish legitimate intermediaries from fraudulent operators.

As more investment advice moves to social media, SEBI’s use of AI signals a shift towards technology-driven enforcement alongside investor education and traditional supervision.