SEBI Bars NIFM Equity and Commodity Research, 3 Partners from Markets; Asks to Refund Rs25.20 Lakh to Investors

Moneylife Digital Team 01 March 2024

Investor Interest

Market regulator Securities and Exchange Board of India (SEBI) has barred NIFM Equity and Commodity Research (noticee 1) and its partners Ritesh Singh Pundir (noticee 2), Nilesh Singh (noticee 3) and Arvind Kumar (noticee 4) for two years for providing illegal investment advisory services. While slapping a fine of Rs4 lakh, SEBI also asked the noticees to refund Rs25.20 lakh collected as fees from or received from any investors or complainants as fees or consideration.

In the order, G Ramar, chief general manager (CGM) of SEBI, says, "The activities of the noticees show that they were providing the service investment adviser for a fee without holding the certificate of registration from SEBI. I note that the noticees received total credit of amounts to the tune of Rs25.20 lakh in their bank account as advisory fees. These being the proceeds of illegal activity, are liable to be refunded to the respective clients of the noticees."

Upon examination, after a complaint was received, SEBI noted that NIFM Equity and Commodity Research was a partnership firm. On perusal of the NIFM Equity and Commodity Research website, it was observed that it used two accounts in ICICI Bank and HDFC Bank. Further, it was also observed from SEBI's database that the firm is not registered with SEBI in any capacity; however, NIFM Equity and Commodity Research has been offering services like investment advisory.

Further, the know your customer (KYC) details and account statement of these bank accounts revealed that Mr Pundir, Mr Singh and Mr Kumar were the partners of NIFM Equity and Commodity Research.

The firm's website, although currently inoperative, offered a range of investment advisory packages for a fee, including stock tips, commodity tips, and futures and options tips, among others. SEBI observed that the pricing of these packages ranged from Rs2,500 to Rs60,000, with payments accepted through deposits into specified bank accounts.

SEBI, further mentioned that NIFM Equity and Commodity Research under packages and pricing tab details on its website there were various packages observed namely forex tips package, equity tips package, future and options (F&O) tips package, commodity (MCX) tips package, agro commodity (NCDEX) tips package, combo (MCX and NCDEX) tips package, combo (equity and commodity) tips, combo (equity+F&O+commodity +currency), equity tips, commodity tips (premium services) and F&O tips (premium services) along with their description, monthly, quarterly, half-yearly and yearly pricing, mode of communication of advice and other features.

The market regulator further mentioned that the noticees received total credit of amounts to Rs25.20 lakh in their bank account as advisory fees. These being the proceeds of an illegal activity, are liable to be refunded to the respective clients of the noticees.

The noticees are, therefore, prohibited from selling their assets and properties, including mutual funds, shares, and securities held by them, in digital and physical form except to effect refunds.

"The noticees shall not undertake, either during or after the expiry of the period of restraint and prohibition, either directly or indirectly, investment advisory services or any activity in the securities market without obtaining a certificate of registration from SEBI as required under the securities laws ," the market regulator says.

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