SEBI directs Baap of Chart owner to deposit ₹17.21 crore amid allegations of fraudulent activities.
The Securities and Exchange Board of India (SEBI) issued a directive on Wednesday, instructing Mohammad Nasiruddin Ansari, the proprietor of “Baap of Chart” on social media platforms, and six associates, to deposit approximately ₹17.21 crore in an escrow account. This action was taken in response to allegations of conducting unregistered and fraudulent illegal advisory services. Notably, Nasir’s YouTube channel, @Baapofchart, boasts over 4.43 lakh subscribers and has accumulated more than seven crore views.
SEBI has not only directed Nasiruddin Ansari but also Rahul Rao Padamati and Golden Syndicate Ventures Pvt Ltd to refrain from accessing the securities market until further orders. This interim order was issued by the regulator to prevent the continuation of any fraudulent or unregistered activities in the interest of investors and to impound and retain the alleged illegal gains.
According to SEBI, Nasiruddin Ansari was observed, prima facie, to be providing recommendations (buy/sell) through social media platforms like Twitter and Telegram under the name “Baap of Chart” while ostensibly offering educational training related to the securities market.
SEBI initiated an examination against Nasir for the period from January 1, 2021, to July 7, 2023, to ascertain if he was engaged in offering investment advisory services without proper SEBI registration through social media or other means.
The examination revealed that Nasir portrayed himself as a stock market expert on various social media platforms. He attracted investors by promoting ‘educational courses’ and inducing them to invest in the securities market with the promise of near-certain profits if they followed his recommendations. However, despite Nasir’s claims of making substantial profits of 20-30 percent, he had, in fact, incurred a net trading loss of about ₹2.9 crore.
Baap of Chart (BoC) was identified as a proprietorship firm owned solely by Nasir. Additionally, Nasir was found to be collecting funds for his ‘educational courses’ through the services provided by Bunch Micro Technologies Private Ltd. He uploaded these courses on website/apps, offering access to his ‘classes’ in return for enrolment fees.
Furthermore, Nasir provided buy/sell recommendations within private groups of his investors/clients. The funds collected for ‘educational courses’ were credited into the bank accounts of Nasir, BoC, Golden Syndicate Ventures Pvt Ltd (where Nasir is a significant shareholder), and P. Rahul Rao (another significant shareholder). Other shareholders of GSVPL include Asif Iqbal Wani, Tabraiz Abdullah, Mansha Abdullah, and Vamshi Jadhav.
Prima facie, SEBI alleges that ₹17,20,76,616.09 was accumulated over just over two years from carrying out investment advisory activities that were both unregistered and fraudulent.
The noticees have been given 21 days to respond to the order, file their replies/objections, and indicate whether they desire a personal hearing.