Highlight Investment Research’s Registration Cancelled by SEBI for Mis-selling and Regulatory Violations

Moneylife Digital Team 15 September 2025

Investor Interest

Market regulator Securities and Exchange Board of India (SEBI) has cancelled the certificate of registration of Highlight Investment Research, a proprietary concern of Shilpa Garg, for multiple violations, including mis-selling, failure to resolve investor grievances and non-compliance with regulatory requirements.

The action follows a complaint filed on 28 January 2022, through SEBI’s SCORES platform. The complainant alleged that the investment adviser (IA) had collected fees for four months, promised assured returns and then became unreachable. Supporting documents included fee payment proofs, call recordings and know-your-customer (KYC) details. Bank records confirmed transfers of Rs1.18 lakh during November–December 2019, while call recordings revealed claims of ‘80%–90% accuracy’ and projections of high profits.

SEBI forwarded the complaint to the adviser in February 2022, followed by reminders in March and May, but received no response. The regulator’s efforts to contact the adviser also failed as the registered numbers were found to be switched off.

SEBI’s investigation revealed three major lapses. First, the adviser had promised assured returns, in clear violation of SEBI’s Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Regulations, the SEBI Act and the IA Regulations. By making misleading claims and failing to warn clients of market risks, the Noticee acted dishonestly and defrauded investors.

Secondly, the adviser failed to address investor complaints and did not file the mandatory action taken report (ATR) on SCORES within the stipulated time. This was despite earlier regulatory action an adjudication order dated 17 February 2022 had already imposed a penalty of Rs1 lakh on the firm for similar lapses.

Third, the adviser failed to obtain membership of the BSE Administration and Supervision Ltd (BASL), which SEBI made mandatory for all investment advisers from 31 October 2021. Non-compliance with this requirement was viewed as a serious breach of fiduciary duty and disregard for regulatory norms.

Earlier, on 30 May 2025, SEBI’s adjudicating officer (AO) imposed a penalty of Rs7 lakh on the firm and recommended cancellation of its registration. SEBI concurred, noting that the adviser not only compromised client interests but also undermined market integrity through reckless and fraudulent conduct. (Read: SEBI Slaps Rs7 Lakh Penalty on Highlight Investment Research for Misleading Investors)

The regulator also observed that the adviser’s registration had expired on 15 February 2022, without renewal, making it ineligible to operate as a registered investment adviser. Unlike other entities that correct lapses when flagged by SEBI, the IA remained non-compliant and non-responsive throughout the proceedings.

In its order, SEBI concluded that Ms Garg was unfit to continue in the securities market as an IA and cancelled Highlight Investment Research’s registration.

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