sebi:WTM/AB/SRO/SRO/15783/2021-22
Facts / Headnote
Noticee found to have acted as unregistered Research Analyst; directed to offer refund of fees to clients, prohibited from taking new clients till refunds completed, and warned to exercise caution; no debarment imposed as registration was subsequently obtained
Provisions invoked
- s. 19
- s. 12(1)
Regulations relied on
Parties
- Mr. Rajesh Ranjan, Proprietor of M/s. KM Financials
Holding
The Noticee acted as a Research Analyst without SEBI registration in violation of Section 12(1) of the SEBI Act, 1992 read with Regulation 3(1) of the RA Regulations, and must give clients who dealt with him prior to registration the option of refund with related reporting and business restrictions.
Full text
Final Order in the matter of Rajesh Ranjan, Proprietor of KM Financials Page 1 of 11 WTM/AB/SRO/SRO/15783/2021-22 SECURITIES AND EXCHANGE BOARD OF INDIA
Final Order in the matter of Rajesh Ranjan, Proprietor of KM Financials Page 2 of 11 reply. The Noticee stated that he would be filing a reply by December 3, 2021. The Noticee also requested for a personal hearing. However, the Noticee did not submit a reply. The matter was placed before for granting a date for hearing on February 2,
Final Order in the matter of Rajesh Ranjan, Proprietor of KM Financials Page 3 of 11 pendency of his application. Subsequently, SEBI sought some additional documents/ clarifications, which were provided by the Noticee. Thereafter, vide letter dated September 22, 2017, the Noticee was informed that his application for registration as a Research Analyst had been rejected. (vii) The Noticee was not doing any business as a Research Analyst after that for two and a half years. Any amount received in the bank account of KM Financials was for the period October 2017 to December 22, 2017 was the remaining fees paid by the existing clients. (viii) Subsequently, the Noticee again cleared the NISM exams and reapplied for registration as a Research Analyst on June 9, 2020. After due process was granted registration on October 15, 2020. (ix) The Noticee is presently working as a Research Analyst and this was his only source of earning. (x) The Noticee has stated that as per the Proviso to Regulation 3(1) of the RA Regulations, if a person acting was a research analyst before the commencement of the RA Regulations, such person may continue to do so for a period of 6 months (until May 31, 2015). If he/ she has applied for registration before May 31, 2015, it can act as RA till disposal of such application. The Noticee has submitted that since he applied for registration as Investment Adviser in June 2016, it can at the highest be alleged that he acted as a Research Analyst without obtaining
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Source: SecMarx — sebi:WTM/AB/SRO/SRO/15783/2021-22. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.