Arshad Warsi banned by SEBI in stock market scam headlines a sweeping action taken by India’s Securities and Exchange Board (SEBI), which has barred the Bollywood actor, his wife Maria Goretti, and 57 others from participating in Indian stock markets for up to five years. This decisive enforcement follows SEBI’s findings of a widespread pump-and-dump operation centered around Sadhna Broadcast Ltd, now known as Crystal Business System, leading to dramatic losses for thousands of retail investors.
Stock Manipulation, Pump-and-Dump Tactics Uncovered
At the core of this scam are pump-and-dump tactics: Sadhna Broadcast’s promoters artificially boosted share prices with collusive trading and misleading promotions. Working with others in their network, these individuals coordinated trades and inflated the stock’s value, selling at a premium to unsuspecting members of the public. Despite typically low trading volumes, this internal manipulation led to many retail investors being financially harmed.
The scheme gained further reach when manipulated waves of misleading YouTube content appeared. Channels such as The Advisor, Moneywise, and Profit Yatra—allegedly linked to Manish Mishra—posted exaggerated claims touting deals with major entities like the Adani Group or large contracts from an American company. The timing of these videos matched key trading periods, exploiting the trust and hopes of retail investors.
Impact on Public Participation and Investor Losses
Between March and December 2022, as this manipulation unfolded, Sadhna Broadcast’s promoter shareholding plummeted from 40.95% to 25.58%, while the public’s stake soared from 59.05% to 74.52%. The number of small investors jumped dramatically from under 900 to more than 72,000, showcasing the massive impact and reach of the scam.
Arshad Warsi and Maria Goretti’s Role
Arshad Warsi entered the market on July 13, 2022, buying 187,000 shares directly from Jatin Shah, another key figure in the operation. Maria Goretti also purchased 265,000 shares. Both claimed they invested based on a friend’s advice, but SEBI cited incriminating WhatsApp chat evidence to dismiss these explanations. The actor and his wife reportedly reaped substantial profits—Rs 41.7 lakh and Rs 50.35 lakh, respectively.
SEBI’s Actions and Ramifications
SEBI’s order compels all 59 entities involved—including the couple—to return illicit profits totaling Rs 58.01 crore, with an annual interest of 12% until full restitution. The watchdog’s decision sends a clear warning about the serious consequences of market manipulation, especially for public figures such as Arshad Warsi and Maria Goretti. It also highlights the vulnerability of retail investors to misinformation and orchestrated frauds, intensifying calls for greater vigilance and stricter regulation in India’s financial system. As the case continues to unfold, SEBI’s crackdown may prompt additional scrutiny of similar trading patterns and digital promotions tied to questionable stocks.
