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Sebi bans Capital True Financial's proprietor from diverting any funds

Press Trust of India/New Delhi 08 Nov 18 | 02:10 PM

Sebi. (Photo: Kamlesh Pednekar)

Market regulator Sebi has barred Narendra Singh Tanwar, proprietor of Capital True Financial Services, from acting as an investment adviser in order to prevent him from further misleading investors on false pretense.

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The market watchdog has also restrained Tanwar from diverting any funds raised from investors until further orders. Also, he has been directed to submit a list of clients and fee collected from them to Sebi within 21 days.

The move comes after the regulator received a complaint in August alleging that Tanwar had promised a lucrative return to the complainant by investing his money in the securities market over a short period of time (4 months) for a large fee.

While examining the complaint, the regulator found that Tanwar had obtained registration from Sebi to act as an IA (investment adviser) by producing an experience certificate which showed that he was working as a portfolio management advisor with the stockbroker during January 2009 to June 2014.

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However, when the veracity of the experience certificate was scrutinised by questioning the signatory of the certificate, it turned out to be prima facie not genuine/forged/fabricated, the regulator noted.

"It is prima facie held that the noticee (Tanwar), by submitting false documents has obtained registration from Sebi as an IA and has prima facie violated...IA Regulations," the Securities and Exchange Board of India (Sebi) said in an order dated November 6.

The regulator believes "there is no other alternative but to take recourse through an ad interim ex-parte order against the noticee for preventing him from collecting fees and indulging in investment advisory activities".

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Accordingly, Sebi through an ex-parte ad-interim order ordered Tanwar "to cease and desist from acting as investment advisor and cease to solicit or undertake such activities or any other unregistered activity in the securities market, directly or indirectly, in any manner whatsoever until further orders".

Besides, he has been ordered, "to immediately withdraw and remove all the advertisements, representations, literatures, brochures, materials, publications, documents, websites, communications etc in relation to their investment advisory or any activity in the securities market until further orders".

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