Sebi order against ‘Baap of Chart’ fresh warning for unregistered finfluencers

The Securities and Exchange Board of India (Sebi) has made it amply clear that is not going to leave any stone unturned when it comes to acting against unregistered investment advisors, especially those who portray themselves as financial influencers or ‘finfluencers’.  

On Wednesday, the capital market regulator came out with a hard-hitting order against Mohammad Nasir, a Hyderabad-based finfluencer who goes by the name ‘Baap of Chart’, for carrying out unregistered and fraudulent illegal advisory service.  

Sebi has ordered Nasir to deposit Rs 17.2 crore that he earned through his advisory service from ‘students’/‘investors’ and has also been banned him from accessing the securities market until further orders.  

This is the latest in a slew of actions Sebi has initiated against finfluencers, and the last one year has clearly shown that such unregistered finfluencers are on the Sebi’s radar.  

Sebi data shows that it has acted against more than 15 unregistered investment advisors in the last one year with orders coming from all levels of Sebi officers—whole-time members, executive directors and chief general managers. This clearly shows that the whole organisation is acting to weed out such entities from the markets as part of its role of safeguarding investor interests.  

Incidentally, the most high-profile action by Sebi was in May when it barred P.R. Sundar—a top finfluencer with over a million followers on YouTube—from the securities market for one year for allegedly providing advisory services like daily stock investment/trading calls without the requisite registration from the regulator.   

The Chennai-based influencer was directed to disgorge the fees that he had taken—along with interest—that amounted to a little over Rs 6 crore.  

Further, entities like Bourse India Investment Advisor, Gunjan Verma, Rocket Tips, Kuber Capital, Sure Shot Future Advisory Services and Crude Oil Tipswala among others have faced the regulatory ire.  

In August, Sebi even issued a consultation paper in which it has proposed restricting the association of Sebi-registered intermediaries and regulated entities with unregistered ‘finfluencers’  

Also read: What is Baap of Chart and why did Sebi fine it ?

“No Sebi-registered intermediaries/regulated entities or their agents/representatives shall, directly or indirectly, have any association/relationship in any form, whether monetary or non-monetary, for any promotion or advertisement of their services/products, with any unregistered entities (including finfluencers),” stated the Sebi consultation paper.  

This assumes significance as regulatory officials, including Sebi chairperson Madhabi Puri Buch, have time and again said that they will be taking strong action against finfluencers who try to trap gullible investors by enticing them with “tried and tested” ways of guaranteed profits. 

 

 

Also read: Hot stocks on October 26, 2023: Tata Motors, Delta Corp, Adani Green Energy, RVNL, Prism Johnson and more           

Also read: Upper circuit today: With 90% rally in six months, this auto stock turned ex-split; check details