Capital market regulator SEBI on Wednesday directed Mohammad Nasiruddin Ansari, owner of “Baap of Chart” in social media platforms, and six other cohorts to deposit about ₹17.21 crore in an escrow account which they collected from ‘carrying out unregistered and fraudulent illegal advisory service’. The YouTube channel of Nasir (@Baapofchart) has over 4.43 lakh subscribers and more than seven crore views.

Ansari, Rahul Rao Padamati, and Golden Syndicate Ventures Pvt Ltd have also been restrained from accessing the securities market until further orders.

The regulator has passed an interim order to “prevent the continuation of any further fraudulent or unregistered activities in the interest of investors, and for impounding and retaining such quantified alleged illegal gains”.

According to SEBI, certain tweets on Twitter (now X) and Telegram, Mohammad Nasiruddin Ansari was prima facie observed to be providing recommendations (buy/sell) through social media in the name of “Baap of Chart” (“BoC”) in the garb of providing educational training related to securities market.

SEBI initiated examination against Nasir (January 1, 2021 to July 7, 2023) to ascertain whether he is engaged in offering investment advisory services without SEBI registration through social media/other means.

During the course of examination, it was observed that Nasir is promoting himself as a stock market expert on various social media platforms and luring investors/clients to enrol for various ‘educational courses’ offered by him and inducing them to invest in securities market by promising them the prospect of making profits with near certainty if the recommendation/advice is followed.

However, contrary to Nasir’s claims that he had been making profits of 20-30 per cent, he in fact incurred a net trading loss of about ₹2.9 crore.

As per the material available on record, BoC is a proprietorship firm with Nasir being the sole proprietor. Further, it was observed that Nasir has uploaded his ‘educational courses’ on website/apps through the application services provided by Bunch Micro technologies Private Ltd, wherein he is collecting money for enrolment in the said courses and providing access to his ‘classes’ to investors/clients.

Also, Nasir is found to be providing buy/sell recommendations in private groups of his investors/clients. It was observed that the amount collected for ‘educational courses’ was credited into the bank accounts of Nasir, BoC, Golden Syndicate Ventures Pvt Ltd (the company in which Nasir is a significant shareholder) and P. Rahul Rao (another significant shareholder). The other shareholders of GSVPL are Asif Iqbal Wani, Tabraiz Abdullah, Mansha Abdullah and Vamshi Jadhav.

Prima facie ₹17,20,76,616.09 has been accumulated during a period of just over two years from carrying out investment advisory activities which are both unregistered and fraudulent, said SEBI order.

The noticees may, within 21 days from the date of receipt of this order, file their reply/objections, if any, and may also indicate whether they desire to avail an opportunity of personal hearing on a date and time to be fixed in that regard, SEBI said.