Mumbai: In one of the strongest orders against misleading financial advice, the Securities Exchange Board of India (SEBI) has issued an order against Avadhut Sathe and his firm Avadhut Sathe Trading Academy Pvt Ltd (ASTAPL), impounding ₹546 crore from the firm. In a 125-page order passed following a detailed probe in FY24, the SEBI has accused Avadhut Sathe and his academy of sharing trading tips, despite warnings issued in March 2024.
The order, issued on December 4, is aimed at cleaning up the finfluencer ecosystem, where unregistered investment advisors offer misleading advice to thousands of investors with the hope of unrealistic returns.
“The activities of the noticees were not limited to general training. They were providing specific advice with entry and exit points. Such conduct is characteristic of an investment adviser, not an educator.” the order noted.
SEBI had earlier received a few complaints against Avadhut Sathe and his academy, where the complainants accused them of offering misleading advice of extraordinary returns through their programs, and had incurred substantial losses as a result. The recordings of the sessions, along with related proof, was also handed over in the complaint.
During the investigation following the complaint, it was revealed that multiple private WhatsApp groups from mentorship batches were used to share stock recommendations, option strategies and index forecasts, a violation of the SEBI Act, Research Analysts Regulations, Investment Advisors Regulations and the PFUTP Regulations.
SEBI has also restrained Avadhut Sathe and his academy from accessing the securities market, directly or indirectly. Banks have been instructed not to permit any debit transactions from their accounts without SEBI’s permission, other than transfers into lien-marked deposits.
After the increased interest in futures and options, misleading advice from such online advisors remains one of SEBI’s leading challenges in its efforts to prevent investors from losing money in the markets.
