SEC introduces social media misconduct reporting mechanism

The Securities and Exchange Commission (SEC), the regulator of the capital market, has introduced a system to report instances of misconduct on social media that could potentially affect the Colombo Stock Exchange (CSE).

With the rapid evolution of communication channels and the increase of social media influence in the financial markets, the SEC said it has recognised the need for proactive measures to identify and address potential social media wrongdoings that may impact investors and market stability.

“Considering these developments, the SEC has taken a significant step towards enhancing investor protection and market integrity with the launch of a dedicated webpage to report suspected market-related wrongdoing on social media,” the SEC said in a statement.

An online webpage, accessible through the SEC's official website, has been launched, offering a user – friendly, confidential, and streamlined process for submitting information related to potential market manipulation, fraudulent activities, and other securities-related misconduct.

By establishing this direct reporting channel, the SEC said it aims to strengthen collaboration with the public, including investors, market participants, and concerned citizens, to play an active role in maintaining the integrity of the securities market.

The SEC said it also encourages individuals to share information by post or send a fax.