Sebi (Investment Advisers) norms specify the eligibility conditions for registration, obligations and responsibilities and procedure for action in case of default, Minister of State for Finance Pankaj Chaudhary in a written reply to Rajya Sabha.
Responding to a query on steps taken by the government to protect retail investors against the frauds happening the social media in the name of giving advice as stock market experts, Chaudhary said that Sebi has issued several press releases advising investors to deal with only registered investment advisers for availing investment advisory services.
Investors can check the registration status of the entity providing investment advisory services on the regulator’s website.
Additionally, the regulator has cautioned investors against trading in the securities markets based on the tips/recommendations provided by unregistered entities/persons and entities impersonating Sebi-registered intermediaries, the minister said. “On receipt of any complaints/references against unregistered entities carrying out such activities, and also after suo moto cognizance, Sebi conducts examination of these entities. In case of non-compliance, appropriate sections of the Sebi Act, 1992 and various Sebi Regulations are invoked, and requisite directions are issued to non-compliant entities,” he added. Further, the issue of the association of Sebi-regulated intermediaries with such unregistered persons or entities was discussed in the Sebi’s Intermediary Advisory Committee.
Considering its recommendations, a proposal for carrying out necessary regulatory amendments to restrict the association of all Sebi-regulated intermediaries with any unregistered entity has been approved, Chaudhary said.
