SEBI temporarily bans Baap of Chart from securities trading, impounds ₹17.2 crore gained from followers

The Securities and Exchange Board of India (SEBI) on Wednesday passed an interim order barring Mohammad Nasiruddin Ansari and others behind 'Baap of Chart' (BoC) from securities trading and impounded ₹17.2 crore he collected from his followers..Whole Time Member Ananth Narayan G observed that Ansari was enticing clients by guaranteeing profits ranging from ₹3 lakh to ₹6 lakh and also providing buying recommendations.."Nasir prima facie is the face of the alleged fraudulent and unregistered investment advisory activity. His sole proprietorship- ‘Baap of Chart’ and the brand recall associated with the same name is central to the allegations made out in this Order. Therefore, it is necessary, in the interest of investors and the integrity of the securities market, for interim directions to be passed against Nasir, not just in his personal capacity but also in his capacity as sole proprietor of ‘Baap of Chart,’" the order stated..Pursuant to an analysis of Ansari's posts on X, SEBI initiated an examination to ascertain whether he was engaged in offering investment advisory services through social media without SEBI registration and in violation of provisions of the SEBI (Investment Advisors) Regulations and the SEBI Act..During the course of examination, SEBI received a complaint against Ansari accusing him of enticing traders with the promise of assured returns. Based on screenshots of WhatsApp groups operated by Ansari and BoC attached with the complaint, the Board prima facie found that he was enticing clients by guaranteeing profits.The Board also observed that BoC's videos on various social media platforms were promising quick and consistent returns through trading. It further noted that Ansari was providing "educational courses" and inducing the ones who had enrolled to invest in the securities market by promising them the prospect of making profits.As such, SEBI prima facie concluded that Nasir and BoC were engaged in providing investment advisory services for consideration to the investors of securities market..SEBI went on to observe that contrary to Ansari's claims of achieving 20-30% profits and maintaining a 95% accuracy rate, the investigation uncovered a net trading loss of ₹2.89 crore incurred by Ansari between January 2021 and July 2023..Funds collected from investors were directed into various bank accounts, including those owned by Ansari, BoC, Golden Syndicate Ventures Pvt Ltd (in which Ansari holds a significant stake) and P Rahul Rao (another major shareholder in Golden Syndicate Ventures). SEBI concluded that these entities were engaged in fraudulent activity and thus called upon them to show-cause and temporarily restricted them from directly or indirectly engaging in the buying, selling, or dealing of securities. Additionally, SEBI impounded alleged illegal gains by Ansari and BoC and directed these individuals and entities to deposit ₹17.2 crore into an escrow account with a scheduled commercial bank within a 15-day period..[Read order-cum-show cause notice]