Mumbai, Nov 12 (NationPress) The regulatory measures undertaken by the Securities and Exchange Board of India (SEBI) in the realm of investment advisory predominantly focus on entities engaged in speculative trading calls, rather than those providing long-term fiduciary investment advice, according to a recent report analyzing enforcement data.

Data compiled from the inception of the SEBI (Investment Advisers) Regulations in 2013 up to March 31, 2025, indicates that out of 218 enforcement orders issued, a notable 67 percent, equating to 147 orders, were directed at unregistered entities, primarily trading call providers.

Moreover, of the 71 orders issued against registered entities, a staggering 65 orders (92 percent) targeted registered trading call providers involved in intraday trading, derivatives, or stock-tipping operations, as highlighted by the Association of Registered Investment Advisers (ARIA) in its analysis of SEBI orders.

Only 6 orders, representing a mere 8 percent of actions against registered entities, and less than 3 percent of total enforcement actions since 2013, were aimed at registered investment advisers.

The report also emphasized that this trend intensified during the financial year 2024-25, where 50 enforcement orders were examined, revealing that 31, nearly 62 percent, were against unregistered entities, while 15, or 30 percent, targeted registered trading call providers.

According to the findings, all six historical orders against Investment Advisers—including four from the last fiscal year—were related to procedural or technical issues like incomplete documentation, KYC deficiencies, or reporting errors. Notably, none involved investor loss or misappropriation. Conversely, actions against unregistered entities frequently included directives for disgorgement of funds or asset freezes, which were not levied against registered entities, the report noted.

"This analysis indicates that the majority of enforcement under the IA Regulations has historically focused on trading-call providers rather than fiduciary investment advisory services," stated ARIA Chairperson Renu Maheshwari.

She added, "With trading-call providers now ineligible for registration as Investment Advisers, it may be a timely opportunity for regulatory focus to shift towards fostering genuine, client-centric fiduciary advice while streamlining compliance obligations designed for a different context."

The report also pointed out that the city of Indore accounted for 13 out of 50 orders (26 percent) in FY 2024-25, making it the top region for penalized entities.

The primary method of uncovering unregistered entities was through public complaints, which accounted for approximately 87 percent of cases, while actions against registered entities were largely initiated through SEBI inspections, nearly 79 percent.

This analysis was compiled in the "SEBI Orders Compilation and Analysis Report 2024-2025" by ARIA, revealing a total of 218 enforcement orders since the SEBI (Investment Advisers) Regulations were enacted in 2013.