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Two manipulation stories, one lesson for traders
Sebi detailed a ₹20 crore finfluencer pump of 82 SME stocks. Same week, $1 billion in oil bets preceded a Trump post. The pattern: retail provides exit liquidity.
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The Same Week, the Same Mechanism
On the same week that Sebi released a 234-page interim order detailing how Hemant Gupta and six family members allegedly pumped 82 SME stocks through Telegram channels and sold into the buying frenzy for an estimated ₹20 crore in unlawful gains, reports emerged of nearly $1 billion in oil futures bets placed 15 minutes before President Trump posted on Truth Social about "productive conversations" with Iran. The post sent crude prices tumbling and equities rallying within minutes.
Read side by side, the two stories become difficult to separate. The Gupta case is a scale model of something happening at the highest levels of global finance. The mechanism is similar: someone with advance knowledge of market-moving content trades before the public can react. The difference lies in who is reachable by enforcement.
The Regulatory Reach Gap
Sebi's entire finfluencer framework – registration requirements, prohibitions on unregistered recommendations, impounding of gains, freezing of accounts – rests on one tacit assumption: the finfluencer can actually be reached. A family operating from India with Indian bank accounts and securities holdings is eminently reachable. The world's most market-moving social media account, held by the president of the world's largest economy, is effectively beyond the reach of any securities regulator. Those positioned to trade on its contents in advance are, for now, reachable only by sternly worded protest letters from Trump's opponents to the SEC and CFTC.
Risk to watch: The regulatory asymmetry means the larger operation is less likely to face consequences. For traders, that gap represents a persistent structural risk, not a one-off episode.
What the Retail Investor Actually Faces
In both cases, the retail investor performs the same role: providing exit liquidity. When the finfluencer sells into the Telegram hype, retail buys. When oil shorts are covered minutes after a Trump post, retail who buys the dip or sells the rally is reacting to stale information. By the time news reaches the public, it has often already been traded upon.
What this means: The pattern is structural, not episodic. As long as a small number of individuals control information that moves markets, front-running will remain a feature of the system. The only variable is enforcement, and enforcement is uneven.