Case Overview

This final order emanates from a show cause notice dated February 18, 2026, issued to Ms. Veena Sharma, a SEBI-registered Investment Adviser (SEBI Registration No. INA000005507), operating as the proprietor of 'Research Guru'. The matter stems from a surprise onsite inspection conducted by SEBI from July 14, 2022, to July 18, 2022, covering the period from April 1, 2021, onwards.

SEBI's inspection revealed multiple alleged violations of the SEBI (Investment Advisers) Regulations, 2013 (IA Regulations) and the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 (PFUTP Regulations). A Designated Authority (DA) was appointed, who issued a pre-enquiry show cause notice on June 25, 2024. After considering the Noticee's replies and a personal hearing, the DA submitted an Enquiry Report on January 23, 2026, recommending the cancellation of the Noticee's certificate of registration.

The principal allegations considered were:

1. Unqualified Employees: The employees of Research Guru did not possess the minimum qualifications or certifications (specifically NISM certification) mandated under Regulation 7 of the IA Regulations. The Noticee admitted during the inspection that none of the approximately 100 employees present were NISM compliant, and some lacked the required educational qualifications.

2. Failure in Core Advisory Duties: The Noticee failed to perform risk profiling and suitability assessments for clients as required under Regulations 16 and 17 of the IA Regulations. Furthermore, the Noticee failed to maintain mandatory records as per Regulation 19(1) & (2) of the IA Regulations and SEBI Circular No. SEBI/HO/IMD/DF1/CIR/P/2020/182 dated September 23, 2020. This included Know Your Client (KYC) records, risk assessments, suitability assessments, client agreements, and call recordings. The Noticee claimed these records were lost during the SEBI inspection.

3. Unauthorized Fee Collection: The Noticee violated clause 1(iii) of SEBI Circular SEBI/HO/IMD/DF1/CIR/P/2019/169 dated December 27, 2019, by receiving advisory fees into bank accounts other than its own, specifically into an account belonging to one Ms. Monika Sharma, an employee. Bank statements were provided as evidence.

4. Misrepresentation and Fraud: The Noticee's website (www.researchbhaskar.com) claimed it had a "team consists of highly qualified analysts who are skilled and impeccable in their analysis," which was false given the unqualified staff. This was deemed a violation of the Code of Conduct (Third Schedule of IA Regulations) and PFUTP Regulations. An undertaking signed by the Noticee also suggested the business was controlled by her nephew, Mr. Abhishek Sharma, and involved franchise arrangements not disclosed to clients, though this specific allegation was given less weight due to a lack of corroborating evidence like franchise agreements.

The Noticee, in her defense, claimed statements were obtained under coercion, data loss was the fault of the inspecting team, employees were only for sales and onboarding, and that she had already paid a penalty of INR 12 lakhs pursuant to a separate adjudication order dated January 22, 2026, for the same set of allegations, which should preclude further action.

Final Outcome

After considering all submissions and material on record, the Adjudicating Officer found the violations under IA Regulations, PFUTP Regulations, and relevant SEBI Circulars to be established. The registration certificate of Ms. Veena Sharma (Investment Adviser), SEBI Registration No. INA000005507, is cancelled with immediate effect. The Noticee, who admitted to having ceased operations 4 years prior, is directed to ensure refund of any pending dues to investors. A copy of the order is to be served to the Noticee and BSE Limited (the Investment Advisers Administration and Supervisory Body).

Topics: SEBI Enforcement, Investment Adviser Compliance, Registration Cancellation