WhatsApp earnings leak: Sebi must monitor insider trading on social media

This new technology presents a challenge but the problem of insider trading is hardly new. The regulator must rise to this new challenge if it is to maintain its reputation for efficiency.

The Securities and Exchange Board of India will investigate possible leaks of company earnings in social media chatrooms after a Reuters investigation documented at least 12 cases of prescient messages about major Indian companies being posted in private WhatsApp groups. This author explains why Sebi should try to create means of observing this medium and others like it. 

A recent Reuters news report identifies a dozen messages that accurately predicted  Q2 earnings patterns (and a bonus announcement in one case) for specific listed stocks. In each case, the messages were being passed around, just before the results were