The Securities and Exchange Board of India (SEBI) has taken action against a prominent social media 'influencer' named Mohammad Nasiruddin Ansari, who operates under the name 'Baap of Chart' (BoC). In response to an investigation revealing Ansari's questionable stock recommendations disguised as educational training, SEBI has prohibited his involvement in securities trading.
SEBI's interim order was issued following a comprehensive analysis of Ansari's activities on various social media platforms, including Twitter (now known as X), Instagram, WhatsApp, and Telegram.
The investigation disclosed that Mohammad Nasiruddin Ansari, who is renowned as the 'Baap of Chart,' purportedly offered educational training related to securities. However, in reality, he was making misleading stock recommendations. These recommendations lured clients and investors with the promise of monthly returns ranging from a minimum of Rs 3,00,000 to Rs 6,00,000.
Furthermore, Ansari provided stock recommendations to individuals who paid for 'live market' transactions, thus influencing them to make investments based on his advice. Operating across several social media platforms, including YouTube, X, Instagram, WhatsApp, and Telegram, Ansari positioned himself as an influential figure in the stock market.
He encouraged clients and investors to enroll in his "educational courses," which were accessible through a website and mobile apps provided by Bunch Microtechnologies Pvt Ltd (Bunch). Ansari enticed unsuspecting individuals with promises of guaranteed returns and profits if they followed his investment advice in the securities market. Notably, he offered a total of 19 courses related to the securities market, with four of them promising assured returns to investors. Ansari facilitated real-time communication with his students through the chat functionality available on the Bunch platform.
During the SEBI investigation, it became evident that Ansari extensively promoted himself as a stock market expert on various social media platforms, alluring investors and clients to enroll in his 'educational courses.' SEBI's order emphasized that Ansari's persuasion tactics led clients to believe they could make profits almost certainly by adhering to his recommendations.
Records indicated that 'Baap of Chart operated as a proprietorship firm, with Ansari as the sole proprietor. He uploaded his 'educational courses' on a website and mobile apps using services provided by Bunch Microtechnologies Private Limited. Ansari collected fees for course enrollments and granted access to his 'classes' to investors and clients.
'Baap of Chart' had a substantial following on social media, with over 4.43 lakh subscribers and more than 7 crore views on his YouTube channel (@Baapofchart). The examination of videos on this channel revealed content promising rapid and consistent returns through trading. Additionally, Ansari operated a Telegram Group/Channel titled "Baap Of Chart Option Hedging" with around 53,000 subscribers. His Instagram account had 59,000 followers, and he had 78,000 followers on X (formerly X). His WhatsApp channel has more than 13,000 followers.
The investigation unveiled that Ansari continued to provide buy/sell recommendations to members until the first week of October 2023.
The SEBI investigation revealed that Ansari collected Rs 13.78 crore through courses and workshops listed on the Bunch platform and mobile apps. SEBI considered this entire amount as fees received from fraudulent and unregistered investment advisory activities. Furthermore, more than 3.42 crore was collected through two UPI IDs linked to Ansari and BoC's accounts in Kotak Mahindra Bank, which were publicly shared on the website and social media platforms.
In total, SEBI concluded that the respondents had collected an amount of Rs 17,20,76,616.09 (Rupees Seventeen Crore Twenty Lakh Seventy Six Thousand Six Hundred Sixteen and Nine Paisa) between January 2021 and July 2023 by enticing clients and investors with misleading and false information regarding course/workshop purchases.
Despite Ansari's claims of making profits of 20-30 percent, SEBI discovered that he actually incurred a net trading loss amounting to nearly Rs 3 crore for the period between January 1, 2021, and July 7, 2023.
To safeguard the interests of investors and uphold the integrity of the securities market, SEBI has taken the following measures:
1. Ansari, along with others (Rahul Rao Padamati and Golden Syndicate Ventures Pvt. Ltd), has been directed to "cease and desist" from acting as or presenting themselves as investment advisors, whether using 'Baap of Chart' or any other alias.
2. Ansari, Rahul Rao, and Golden Syndicate Ventures are barred from buying, selling, or dealing in securities, both directly and indirectly.
3. Within 15 days, they are required to deposit Rs 17.2 crore in an escrow account with a scheduled commercial bank.
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