The Securities and Exchange Board of India imposed a fine of Rs 4 lakh on Basant Maheshwari Wealth Advisers. The company is accused of violating fee policies and using misleading captions in its YouTube videos.
The fine needs to be paid within 45 days. Otherwise, the market regulator may levy interest and initiate proceedings to seize movable and immovable assets, as noted by the adjudicating officer in the order.
What is the matter?
The action was taken following an inspection by SEBI and BSE Administration and Supervision in October and December 2023. During the inspection, it was discovered that BMWAL imposed charges on 32 clients using both fixed and asset-based advice methods. This practice is prohibited by the market regulator under Regulation 15A of SEBI's Investment Advisers (IA) Regulations. According to the regulations, investment advisers can only charge their clients using one of two methods.
Furthermore, while SEBI was investigating, BMWAL was uploading YouTube videos with "exaggerated captions" and was "in non-compliance with the advertisement code". The regulator's order included captions like "100x Portfolio - 3 Saal Mei?" Kaise Kiya?", "10 Saal Mei 10 Guna, 20 Saal Mei 100 Guna!! "Kaise Kare?.""1 Crore Ko Double Kaise Kare?" "Explained in Two Minutes" and "Kaise Banaya Rs 150 Crores Sirf Trading Kar Ke?"
Basant Maheshwari Wealth's response
However, in its response, the company claimed that the videos were aimed at "knowledge enrichment for the general public," but SEBI rejected the claim. The regulatory body noted that the disclaimer was "not clearly brought out in the description of videos".
