SEBI on Thursday barred Finassure Financial Services Pvt Ltd (FFSPL) and its directors from the securities market for up to three years for providing unauthorised investment advisory services.
The directors of FFSPL are Amit Sharma and Saket Sharma.
In addition, they have been asked to refund Rs 61.39 lakh collected from their clients as fees in respect of their unregistered investment advisory services "jointly and severally".
In its order, SEBI found that noticees (FFSPL, Amit and Saket) were providing investment advisory services without obtaining a registration certificate from the regulator, which was in violation of the provisions of Investment Advisers (IA) rules.
The order revealed that Rs 61.39 lakh were credited in the accounts of FFSPL between February 2014-2017.
"I find that FFSPL through its website was carrying out investment advisory activities without having a valid certificate of registration from SEBI. Therefore, FFSPL has violated the IA regulations," SEBI's whole-time member Ashwani Bhatia said in the order.
Amit had controlled the affairs of the firm and was the main beneficiary of the funds received from the clients. "Accordingly, I find that Amit has violated the provisions of IA norms," Bhatia said.
According to SEBI, Saket being a director of the firm had facilitated in carrying out investment advisory activities.
However, the regulator did not find that Saket was controlling the affairs of the company or was the beneficiary of funds received from investors.
Accordingly, the regulator has barred FFSPL, Amit for a period of three years and Saket for a period of one year from the securities markets.
The debarment would continue till the expiry of noticees' restraint period from date of completion of refunds to investors.
Further, the noticees were directed not to undertake investment advisory services or any activity in the securities market without obtaining a certificate of registration from SEBI, either directly or indirectly, during or after the expiry of the period of debarment, the order said.