India’s market regulator, the Securities and Exchange Board of India (SEBI), has barred Asmita Patel Global School of Trading (APGSOT) and six associated entities, including well-known finfluencer Asmita Patel, from capital markets over allegations of unregistered investment advisory services. The regulator has also directed them to return INR 53.67 crore, which was collected from course participants as fees.
In an interim order issued on Thursday, SEBI restrained Patel, her firm, and associated entities from offering any advisory or research analyst services. The regulator has also sought an explanation on why an additional INR 104.63 crore collected from participants should not be impounded.
Allegations of Misleading Investors
According to SEBI, APGSOT misled participants by making exaggerated profit claims and charged high fees for trading courses with minimal educational value. Patel, who brands herself as the ‘She Wolf of the stock market’ and the ‘Options Queen’, claimed to have mentored over one lakh traders. Complainants alleged that she amassed INR 140 crore in assets through her courses.
The investigation found that APGSOT was not just offering trading education but was actively advising investors on specific stock trades. Buy/sell recommendations were allegedly provided via Telegram channels, Zoom meetings, and emails, making it an unregistered investment advisory service.
Funds Routed Through Multiple Entities
SEBI’s probe revealed that course fees were collected through various firms—King Traders, Gemini Enterprise, and United Enterprises—to circumvent regulations. This was not a one-time occurrence but a structured scheme designed to evade compliance.
Furthermore, SEBI noted that APGSOT encouraged students to open trading accounts with a particular stockbroker (ABC Ltd.) and directed them to trade specific stocks. This, according to the regulator, reinforced the investment advisory nature of the operation.
Regulator’s Directive and Next (LON:NXT) Steps
SEBI has ordered a complete halt to APGSOT’s advisory-like activities and banned it from conducting any unregistered or fraudulent securities market operations. However, the regulator clarified that the findings are preliminary, and the entities have an opportunity to present their defense.
The probe, covering August 2019 to October 2023, was triggered by a complaint from 42 investors alleging unauthorized advisory services. SEBI’s next steps will depend on the responses from the accused entities and further investigation into their financial operations.
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