Market regulator Sebi on Wednesday came down hard on Mohammad Nasir, a Hyderabad-based finfluencer who goes by the name 'Baap of Chart', for carrying out unregistered and fraudulent illegal advisory service.
He has been directed by Securities and Exchange Board of India to deposit Rs 17.2 crore in an escrow account that he earned through his advisory service from 'students'/'investors' and has also been banned from accessing the securities market until further orders.
Sebi has provided a window of three months, or until the expiry day, whichever is earlier, for squaring off open positions. The market regulator has alleged that Nasir has been providing trading recommendations under the 'garb of educational courses', which were charged for. It is also alleged that he was "luring clients/investors through misleading or false information to purchase his courses/workshops".
“Noticee Nos. 1 (Mohammad Nasiruddin Ansari), 2 (Rahul Rao Padamati) and 5 (Golden Syndicate Ventures Pvt. Ltd. ) are restrained from buying, selling or dealing in securities either directly or indirectly, in any manner whatsoever until further orders. If Noticee Nos. 1, 2 and 5 have any open position in any exchange traded derivative contracts, as on the date of this Order, they can close out / square off such open positions within 3 months from the date of this Order or at the expiry of such contracts, whichever is earlier. The said Noticee Nos. 1, 2 and 5 are permitted to settle the pay-in and pay-out obligations in respect of transactions, if any, which have taken place before the close of trading on the date of this Order," said Sebi in its interim order passed on Wednesday.
The noticees earned around Rs 17.2 crore in about 18 months from such frauduluent activities, Sebi found. The market regulator has directed Nasir and two others to deposit the impounded amount in an escrow account within 15 days and is barred from diverting any funds raised from investors.
Sebi also found that 'Baap of Chart' incurred Rs 2.89 crore loss in trading while claiming to have a proprietary algorithm “clocking a profit accuracy of 95%”.
"During the examination, it was observed from the website of BoC (https://baapofchart.com/) that Nasir is presented as a “stock market wiz” who has developed BoC which is a proprietary algorithm “clocking a profit accuracy of 95%” and designed BoC to give “profits day after day eliminating any chance of overall loss”," said Sebi in its order.
Netizens rejoiced at Sebi's crackdown and said such finfluencers deserve jail time also for their unscrupulous activities.
"When enough people take out the time to raise official complaints, everyone benefits," said one X user.
"Rs 17 crore income is generated by a PMS having AUM above Rs 600-700 crore. Fault also lies with people who got lured with greed without checking credentials of the company/ team/ process/ track record and all. Speed thrills, but it also kills," said Varinder Bansal, founder of Omkara capital.
'Baap of Chart' has 4.43 lakh subscribers and 7 crore views on YouTube and also has large following on other social media platforms.