Almost 5 Years after Complaint, SEBI Bans Indore-based Wishworth Financial Services and Its Proprietors from Market for 4 Years
Moneylife Digital Team 12 September 2022
The Securities and Exchange Board of India (SEBI) has barred Wishworth Financial Services and its proprietors Pankaj Khanchandani and Dheeraj Kapoor from the securities markets for four years and directed them to refund the money collected through unauthorised investment advisory services.
 
The matter relates to a complaint filed on 24 October 2017 by Naresh Maini. The complainant alleged that Wishworth Financial Services was offering financial investment plans with assured returns. Mr Maini had paid Rs41,499 to the noticees but had failed to receive any communication from the noticees thereafter.  
 
Following the receipt of the complaint, SEBI conducted an examination in the matter and, thereafter, issued a show-cause notice dated 20 January 2022 to the noticees.
 
The market regulator found that the noticees—Wishworth Financial Services and its proprietors—were engaged in the business of providing investment advice to their clients for a consideration and, thus, acting as investment adviser. SEBI also found that they were involved in such investment advisory activities without obtaining a certificate of registration from the market regulator which is in violation of the provisions of Investment Adviser (IA) rules, SEBI said in its order.
 
 
The noticees  through  their website www.wishworth.in (the  website  is  no  longer  active; however, archive pages of the website were downloaded from web.archive.org), had stated that: “(they are) a  team  of  expert  market  analyst  with  huge  experience  in  capital  market research”. They also claimed to provide  recommendations  for stocks  in cash, futures  and  option,  traded  in NSE & BSE commodities including bullions, metals and energy traded in MCX.The website added ”We provide live recommendations  through  SMS  and  chat  room  services. Our  SMS  facility  is  a  very effective system which ensures the instant message delivery without any loss of time, so the clients get sufficient time to execute their trades in order to fetch maximum profits.”
 
 
Through  their  website, the noticees  used to offer  prospective  clients,  various subscription packages relating to recommendations for stocks in cash, futures & options, etc, as shown below:
 
 
A show-cause notice (SCN) was issued by SEBI and the notice was also effected through suitable newspaper publications dated 4 March 2022. 
 
Pursuant to service of SCN, an opportunity of hearing was granted to the noticees on 22 July 2022. However, the noticees did not appear for the hearing nor was any request for adjournment received from them. 
 
Through such services, they had received a total amount of over Rs10 crore from July 2017 to February 2020 through unregistered investment advisory services, it added.
 
Accordingly, in an order which was passed on 9 September 2022, SEBI said, the "noticees shall within a period of three months... jointly and severally, refund the money received from any complaints/investors, as fees or consideration or in any other form, in respect of their unregistered advisory activities."
 
The noticees are prevented from selling their assets, properties and holding of mutual funds  /shares  /securities  held  by  them  in demat  and  physical  form  except for the sole purpose  of  making  the  refunds  as  directed by the SEBI order. Banks  have also been directed  to allow debit only for the purpose of making refunds to the complainants /investors /clients who were availing the unregistered investment advisory services from the noticees.
 
Also, the noticees have been barred from accessing the securities markets for four years or till the expiry of four years from the date of completion of refunds to investors, whichever is later.
Comments
saharaaj
3 months ago
If such heinous action attract such low penalties , what is the mesage to investors ? do not invest in India
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