The Securities and Exchange Board of India (SEBI) has barred Bollywood actor Arshad Warsi, his wife Maria Goretti, and his brother from participating in the securities markets for one year. The action comes in connection with a scam involving Sadhna Broadcast Ltd, now renamed Crystal Business System Ltd, where misleading investment tips were promoted via YouTube to artificially inflate stock prices and facilitate offloading by insiders.
SEBI’s probe revealed that the actors, along with 56 others, were part of a manipulative pump-and-dump scheme backed by a deceptive online campaign. YouTube videos urged viewers to buy Sadhna Broadcast shares with promises of exponential returns, while entities behind the scheme quietly dumped their holdings at inflated prices.
The alleged fraud took place between March 8, 2022, and November 30, 2022, and followed a pattern of using high-profile influencers, social media algorithms, and coordinated trading activity to distort the market.
Profits, Penalties, and Bans: SEBI’s Enforcement Action
SEBI’s Thursday order imposed a variety of sanctions on the 59 entities. Arshad Warsi reportedly earned ₹41.70 lakh, while his wife profited ₹50.35 lakh by trading in Sadhna shares. Both have been fined ₹5 lakh each and banned from trading—directly or indirectly—for one year. The order notes that Warsi also executed trades on behalf of his wife and brother, compounding the regulatory violations.
At the core of the scheme were masterminds Gaurav Gupta, Rakesh Kumar Gupta, and Manish Mishra, with Mishra slapped with a ₹5 crore penalty. The others, including Subhash Aggarwal (a director of the RTA), Piyush Agarwal (a dealer at Choice Broking), and Lokesh Shah (a stockbroker franchise owner), were fined ₹2 crore each.
In total, SEBI has ordered the implicated parties to disgorge unlawful gains worth ₹58.01 crore with 12% annual interest from the end of the investigation period until repayment.
How the Scam Worked: Paid Content, Market Hype, and Retail Losses
The entire scheme was triggered by complaints received by SEBI in mid-2022, alleging price manipulation of Sadhna Broadcast shares. The modus operandi involved:
- Uploading misleading stock tips via paid YouTube videos.
- Amplifying reach through expensive marketing campaigns.
- Creating a false buzz to attract retail investors.
- Dumping shares at inflated prices by insiders who had pre-acquired them.
SEBI’s investigation confirmed that false narratives were manufactured, suggesting upcoming business deals and lucrative partnerships that never materialized. These fabricated claims were disseminated using influencers and paid ad targeting, deceiving thousands of unsuspecting investors.
The crackdown by SEBI marks one of the most high-profile actions taken against a coordinated social media-driven stock pump scheme in India and underscores growing regulatory scrutiny over digital influence on the capital markets.