Sebi bans 'She Wolf' of Dalal Street Asmita Patel, 5 others from markets, impound illegal gains of over Rs 53 cr

New Delhi: Markets regulator SEBI has banned six entities, including Asmita Patel Global School and fin-influencer Asmita Patel, from the capital markets for alleged unregistered investment advisory services and directed to disgorge over Rs 53 crore collected as fees course participants for various courses.

SEBI through an interim order cum show cause notice passed on Thursday prohibited six entities, including Asmita Patel Global School of Trading Pvt Ltd (APGSOT), Asmita Jitesh Patel, Jitesh Jethalal Patel, King Traders, Gemini Enterprise and United Enterprises, from the capital market.

The Securities and Exchange Board of India (SEBI) has also asked the six entities to explain why another Rs 104.63 crore should not be collected as fees for various programmes and should not be seized as well, according to a SEBI order.

The case pertains to individuals enrolling in trading courses provided by Asmita Patel Global School Of Trading. The SEBI order said that they were misled by exaggerated promises of profits and forced into paying high fees for minimal or ineffective trading education.

YouTuber and financial influencer Asmita Patel portrays herself as the 'She Wolf of the stock market' and the ‘options queen’ and claimed to have mentored over one lakh students/investors/participants worldwide. As per the complainants, she (Asmita) has assets to the tune of Rs 140 crore using her proprietary system.

The regulator noted that each entity has played specific roles at various stages which have prima facie, been found to violate SEBI's rules.

Further, SEBI revealed that, prima facie APGSOT along with the Asmita and Jitesh devised a scheme wherein students/investors/participants were lured to trade in specific stocks and told to open a trading account with ABC Ltd.

Recommendations of buy/sell of specific securities were provided and uploaded on telegram channels owned by APGSOT. The acts of the entity make it evident that it was providing investment advice/ research analyst services to students/investors/participants for consideration in the pretext of imparting education, the 129-page order said.

The regulator also pointed out that the APGSOT collected fees from course participants through King Traders, Gemini Enterprise and United Enterprises directing them to pay the course fees to the bank accounts of these entities.

According to SEBI, this was not a one-time arrangement but a regular practice followed by the Asmita Patel Global School of Trading to route funds through different entities.

SEBI noted that these six entities are jointly and severally liable for impounding Rs 53.67 crore collected as fees from participants for courses such as, LMIT (Let’s Make India Trade), MPAT (Master’s in Price Action Trading) and Options Multiplier (OM) offered by the Asmita Patel Global School of Trading.

By indulging in these practices, APGSOT, its director Asmita, and Jitesh were directed by SEBI to cease and desist from offering unregistered investment advisory or holding themselves out to be as investment advisors/ research analysts.

They have also been ordered to cease to solicit or undertake any other unregistered or fraudulent activity in the securities market, directly or indirectly, in any manner whatsoever, SEBI said.

However, the markets watchdog clarified that findings in this order are prima facie findings and the entities have full opportunity to provide their defence and prove their innocence. This prima facie finding should also be viewed in that manner and should not be taken as a final verdict against anyone.

SEBI has examined APGSOT and its directors following a complaint from a group of 42 investors alleging unauthorised investment advisory activities.

The regulator conducted an examination covering the period from August 2019 to October 2023, focusing on APGSOT, its director Asmita -- who is also an authorised person of registered stockbroker ABC Ltd -- and Jitesh, along with proprietary firms King Traders, Gemini Enterprise, and United Enterprises.

According to SEBI, APGSOT was allegedly providing stock buy/sell recommendations through private telegram channels, Zoom meetings, and emails, besides offering educational courses. The probe aimed to determine whether APGSOT was offering investment services without the necessary SEBI's registration, as mandated under Investment Adviser (IA) rules.