Did SEBI Really Cancel the Registration of a ‘Research Analyst’ Who Was Just Running a Grocery Store?
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Synopsis
In an unexpected twist, SEBI has revoked the registration of an individual registered as a research analyst who was actually just running a grocery store. This unusual case raises questions about regulatory oversight in financial markets and the integrity of investment advisory services.
Key Takeaways
- SEBI cancelled the registration of a grocery store owner posing as a research analyst.
- The case highlights regulatory oversight issues in financial advisory services.
- Complaints revealed fraudulent practices by investment websites.
- Investors must be vigilant about validating advisors' credentials.
- The incident calls for stricter regulations to protect investors.
Mumbai, Dec 30 (NationPress) In a stunning revelation that left even the regulatory body astounded, the Securities and Exchange Board of India (SEBI) has revoked the registration of an individual who was officially recognized as a research analyst but was, in reality, operating a modest grocery store in Madurai.
SEBI annulled the registration of Purooskhan after discovering that he had no active participation in the securities market.
During a hearing, it was revealed that he runs a small 100-square-foot provision store offering everyday necessities and snacks, without providing any market analysis or investment guidance.
The inquiry was overseen by SEBI’s quasi-judicial authority, Santosh Kumar Shukla, who expressed disbelief at how such an individual managed to register as a research analyst.
In his ruling, Shukla indicated that during the virtual proceedings, Purooskhan appeared to lack familiarity with securities market operations and explicitly mentioned that he was merely managing a small business, not engaging in any research analyst activities.
Based on these findings, SEBI opted to cancel his research analyst registration.
The case originated in June 2022 when SEBI received a complaint via its SCORES platform concerning a website named optionresearch.in.
This website made promises of “sure shot” trading calls, claimed to offer zero risk, and assured investors that their investments would double.
The complainant had paid Rs 50,000 for these services but subsequently incurred losses amounting to approximately Rs 4 lakh.
Upon investigation, SEBI uncovered that the website was offering numerous paid investment advisory packages while portraying itself as a SEBI-registered organization.
Purooskhan’s SEBI registration number was prominently displayed on the site.
When questioned, Purooskhan informed SEBI that his registration details were being exploited, asserting he had no affiliation with the website.
He provided copies of police reports submitted to the Tamil Nadu Police and the Cyber Cell, claiming online financial fraud.
Nevertheless, SEBI observed that the Option Research Company had allegedly been permitted to utilize his registration details.
The regulator also noted that Purooskhan had shared his email ID and password, raising significant concerns about security.
Later, Purooskhan claimed that a partner from the company approached him under the guise of a bank employee, informing him of a vacancy for a research analyst.
He alleged that his documents were collected under this pretext and subsequently misused.
Upon SEBI initiating its investigation, the company allegedly issued him an appointment letter designating him as a compliance officer and permitting him to issue trading calls, an offer he claimed to have declined.
Point of View
It's crucial to recognize that this incident exposes gaps in the regulatory framework of financial markets. While the actions of SEBI are commendable in addressing such discrepancies, it also highlights the need for more stringent verification processes to prevent misuse of registrations. We must ensure that the integrity of financial advisory services remains intact to protect investors.
NationPress
02/01/2026
Frequently Asked Questions
What led to SEBI's decision to cancel the registration?
SEBI canceled the registration after discovering that Purooskhan, the so-called research analyst, was actually running a grocery store and had no involvement in the securities market.
Was the grocery store owner involved in any fraudulent activities?
While the owner claimed his registration details were misused by a website offering dubious investment advice, SEBI found inconsistencies in his statements.
What was the complaint against the website optionresearch.in?
The complaint stemmed from promises made by the website of guaranteed returns on investments, which led to substantial financial losses for the complainant.
How did SEBI find out about this case?
The case was brought to SEBI's attention through a complaint lodged on its SCORES platform in June 2022.
What are the implications of this case for future investors?
This incident emphasizes the importance of verifying the credentials of investment advisors and the need for regulatory bodies to enforce stricter oversight.
