Sebi to seize Rs 546cr in biggest order against a ‘finfluencer’

Market Regulator Sebi Cracks Down on Avadhut Sathe Trading Academy and Avadhut Sathe

Market regulator Sebi has taken a significant step against Avadhut Sathe Trading Academy and Avadhut Sathe, impounding Rs 546.2 crore in one of the most notable orders against a stock market influencer.

Entities Accused of Misleading Investors

The entities have been accused of providing unregistered investment advisory and research analyst services under the guise of education, misleading nearly 3.4 lakh investors with false claims of high returns.

Barred from the Market Pending Further Orders

Avadhut Sathe Trading Academy and Avadhut Sathe have been barred from the market pending further orders, as per the Sebi directive.

Key Findings by Sebi

• Collected a little over Rs 601 crore from nearly 3.4 lakh investors.
• Provided unregistered investment advisory and research analyst services under the guise of stock market education.
• Solicited and induced investors to deal in the securities market on the basis of investment advice and stock analysis without having the requisite registration certificate.
• Collected substantial amounts of fees from unsuspecting investors.
• Disseminated misleading information and advertisements through social media, aimed at inducing investors by portraying unrealistic returns from stock market activities.

Sebi's Warning and Investigation

Sebi had examined the activities of Avadhut Sathe Trading Academy and Avadhut Sathe in fiscal 2023-24, which showed that the entities were publishing selective profitable trades of course participants and investors, claiming that they consistently earned through trading, and that its trainers were stock market experts.

However, Sebi analysis of their trades showed that all such trainers and course participants and investors were in net losses. In March 2024, Sebi had issued a warning to the two entities, cautioning them against misrepresentation and selective disclosures.

Entities Continued to Publish Misleading Content Despite Warning

Despite the warning, the two entities continued to publish misleading videos, Sebi said in the order.

Complaints Against the Entities

The regulator had also received a few complaints against the two entities who had subscribed to various programs offered by Avadhut Sathe Trading Academy and Avadhut Sathe. The complainants alleged that despite the extraordinary returns promised in the programs, many course participants and investors incurred substantial losses.