In a significant development in the Indian Securities market, the Securities and Exchange Board of India (SEBI) has directed influencer Ravindra Bahrti to repay a sum of Rs 12 crore due to unlawful gains made through false promises of astronomical (1000%) returns. This action underscores SEBI’s commitment to protecting investors’ interests and maintaining market integrity.
The action stems from an investigation by SEBI which revealed that Bharti, through his firm Ravindra Bharti Education Institute Pvt. Ltd. (RBEIPL), lured investors with unrealistic promises. RBEIPL provided instruction and training in the stock market even though it was not registered as an investment advisor. But SEBI’s ruling draws attention to how dishonest their actions are, especially the marketing of “guaranteed returns up to 1000 percent.” This flagrant betrayal of investor trust is against the law and compromises the integrity of the market.
Ravindra Bharti, known for his YouTube channels “Bharti Share Market Marathi” and “Bharti Share Market – Hindi” boasting substantial subscriber bases, held a prominent position in the realm of financial education. However, SEBI’s order highlights the importance of ensuring that such influencers provide accurate and reliable information to their followers, rather than making unrealistic promises for personal gains
.
Furthermore, SEBI’s interim order extends beyond Ravindra Bharti to include RBEIPL and its current and former directors, Rahul Nanta Gosavi, and Dhanashri Chandrakant Gosavi. These parties have been instructed to cease offering investment advisory services and refrain from engaging in any securities transactions until further notice. This decisive action underscores SEBI’s commitment to maintaining the integrity of the capital markets and protecting investors from potential harm.
Additionally, SEBI directed the impounding of Rs 12.04 crore, the total unlawful gain allegedly earned by RBEIPL. These funds will be deposited in an interest-bearing Escrow Account held by a nationalized bank, effectively freezing them under SEBI’s control.
The case of Ravindra Bharti raises concerns about the growing influence of financial influencers, or “finfluencers”, in the investment landscape. Social media platforms and online channels have provided them with a powerful tool to reach a large audience. However, the lack of proper regulation in this space can create opportunities for unscrupulous individuals to mislead unsuspecting investors.
SEBI’s action serves as a cautionary tale for investors to exercise prudence and conduct thorough research before making investment decisions based solely on online recommendations. It’s crucial to verify the credentials and legitimacy of influencers before trusting their advice. SEBI’s emphasis on disclosure and transparency reflects its broader mandate to uphold market integrity. As India’s capital market continues to witness exponential growth, fueled by increased public participation, safeguarding investors’ interests becomes paramount. By holding accountable those who exploit investors’ trust, SEBI seeks to foster a culture of compliance and ethical conduct within the financial industry
A precedent for more stringent enforcement against deceptive investment activities is established by the SEBI ruling against Ravindra Bharti. It also emphasizes the necessity of more stringent laws governing financial advice given online. Campaigns to educate and raise awareness among investors are essential as the capital market develops to help reduce the hazards connected with unregulated investment advice providers and influencers.
