sebi:WTM/SR/SEBI/IMD/57/11/2016
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Facts / Headnote
Ad-interim ex-parte directions prohibiting CapitalVia and its Directors from soliciting or undertaking any fresh advisory business with immediate effect, directing grievance redressal and compliance report within three months; order treated as show cause notice.
Provisions invoked
- s. 11
- s. 19
- s. 12(3)
Regulations
- Reg. 13
- Reg. 16
- Reg. 17
- Reg. 22
- Reg. 15(1)
- Reg. 7(2)
- Reg. 18
- Reg. 19
- Reg. 15(9)
- Reg. 15(8)
- Reg. 13(c)
Parties
- CapitalVia Investment Research Limited
- Mr. Kiran Ravindra Kumar Choudhary
- Mr. Rohit Gadia
- Mr. Anshul Mansingka
Holding
SEBI found that CapitalVia Investment Research Limited and its Directors prima facie violated multiple provisions of the Investment Advisers Regulations, 2013 and the Code of Conduct thereunder, and issued an ad-interim ex-parte order restraining them from undertaking fresh advisory business pending enquiry.
Full text
Page 2 of 20 iii. Ensuring suitability of the advice provided to the clients. iv. Making disclosures specified in IA Regulations. v. Segregating investment advisory and execution services. vi. Acting in fiduciary capacity and with due skill, care and diligence towards its clients while providing advisory services. vii. Maintaining records as specified in IA Regulations. viii. Charging reasonable fees to the clients. ix. Obtaining requisite certifications by the employees of the company to provide investment advisory services. x. Disclosing factually correct information on website with regard to the advisory services offered by CapitalVia. xi. Disclosing relevant material information including its registration details while soliciting clients through various websites.
Page 3 of 20 iv. The website of CapitalVia i.e. www.capitalvia.com contains terms and conditions on which we offer advisory services and all such other information as is necessary to take an informed decision on whether or not to avail its services. We do not have disciplinary history and we have no affiliates with other intermediaries. The relevant disclaimers are mentioned at our website and we also mention the disclaimers in our email communication with the clients. v. Few clients gave a written approval for execution over mail and gave the contact details of their brokers. In view of the same, we used to serve buy and sell call signals to other individuals/ entities/ brokers and no adverse inference may be drawn against CapitalVia for the services being provided to a retail investor. vi. Prior to the inspection, we were taking majority of the details of the person to enable us to have a fair idea about him so that the free trial of a suitable product can be given. However, during the course of discussion with the inspection team, it was brought to our notice that the details gathered are inadequate to form a fair idea of the risk profile and suitability of the product of the client. vii. As regards disclaimer being given by CapitalVia, these are standard disclaimers being given by each intermediary of the capital market. The practice of giving disclaimers has been an international practice and it is just to educate the investor that if one can earn profit then a loss can
Page 4 of 20 6. It is noted that SEBI received several complaints from the clients of CapitalVia (approx.240 complaints on SCORES). Most of them were in the nature of allegation of 'loss in trade' due to advisory services provided by CapitalVia.
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Source: SecMarx — sebi:WTM/SR/SEBI/IMD/57/11/2016. 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.