New Delhi – In a significant move to protect investors, the Securities and Exchange Board of India (Sebi) has barred financial influencer Asmita Patel and five other entities from the securities market. The regulator has also impounded ₹53 crore of illegal gains amassed through unregistered investment advisory services.
Misleading Promises and Exaggerated Claims
Asmita Patel, who branded herself as the “She Wolf of the stock market” and the “options queen,” operated a trading school named Asmita Patel Global School of Trading Pvt Ltd (APGSOT). Through her YouTube channel and other social media platforms, she offered various courses promising lucrative returns to aspiring traders. However, Sebi’s investigation revealed that APGSOT was not providing genuine education but rather engaging in unregistered investment advisory services.
Luring Students into a Trap
Sebi’s order states that APGSOT, along with Asmita and her associates, devised a scheme to lure students into trading specific stocks and opening trading accounts with a particular brokerage firm. Participants were misled by exaggerated promises of profits and coerced into paying exorbitant fees for trading education that was either ineffective or non-existent.
Routing Funds Through Multiple Entities
The regulator also found that APGSOT collected fees from course participants through third-party entities, including King Traders, Gemini Enterprise, and United Enterprises. This was not a one-time arrangement but a regular practice to route funds through different entities, raising further suspicion about the legitimacy of APGSOT’s operations.
Sebi’s Stern Action
Sebi has directed Asmita Patel, APGSOT, and the other involved entities to cease offering investment advisory and research analyst services. They are also prohibited from soliciting or undertaking any other unregistered or fraudulent activity in the securities market. The regulator is also considering seizing the entire ₹104 crore collected from investors and students as course fees.
Crackdown on Finfluencers
This action against Asmita Patel is part of Sebi’s broader crackdown on financial influencers who mislead retail investors under the guise of providing educational content. The regulator has proposed stricter regulations for finfluencers, including a ban on using real stock price data in educational content, direct or indirect stock recommendations by unregistered individuals, and unverified claims of trading success.
Protecting Investors
Sebi’s proactive approach sends a clear message that it will not tolerate unregistered investment advisory services and misleading claims by finfluencers. The regulator is committed to protecting investors and maintaining the integrity of the securities market.
Conclusion
The ban on Asmita Patel and her associates, along with the impounding of illegal gains, is a significant step towards curbing the menace of unregistered investment advisory services. Sebi’s ongoing efforts to regulate finfluencers will help safeguard investors from misleading information and fraudulent schemes.
