In a startling revelation, Abhishek Kar, one of the most prominent finfluencers in the industry, has admitted to engaging in deceptive practices by offering "buy" and "sell" recommendations disguised as 'B' and 'S', thereby violating SEBI (Securities and Exchange Board of India) regulations. This revelation exposes a concerning trend where unregistered individuals sell investment advice to attract subscribers for their trading courses.
Abhishek Kar, with a substantial following of over 1.5 million on various social media platforms, is now facing scrutiny for his actions. Despite being a sought-after guest speaker at prestigious institutions like the Indian Institute of Technology (IIT) and the Institute of Chartered Accountants of India (ICAI), it appears that Kar had been using his influence to promote his trading courses by providing investment advice.
In an audio recording that has been widely circulated online, Kar can be heard confessing to the use of coded language ('B' and 'S') to convey "buy" and "sell" recommendations. This admission raises concerns as Kar is not a registered financial advisor, and thus, offering investment advice without proper registration is a clear violation of SEBI norms.
During a conversation with Shreyas Bandi, a veteran trader and a figure known for debunking financial myths, Kar attempted to justify his actions by stating, "I was never writing 'buy' or 'sell' on my Telegram channels, only giving 'B' or 'S,' but yes, technically it means more or less the same."
This revelation has triggered an online campaign aimed at holding trader-trainers like Abhishek Kar accountable for their actions. Trader-trainers have often been criticized for enticing individuals with the promise of substantial earnings from trading, despite knowing the risks involved. Consequently, various platforms have urged trader-trainers to provide verified profit-and-loss statements as evidence of their claims, a request that has met with resistance from many in the industry.
The conversation between Bandi and Kar sheds light on the illegal practice of unregistered individuals providing investment advice to foster the rapidly growing "training" business. Kar admitted that he initially started his Telegram group by sharing charts but later turned to "observational trades" to attract more subscribers.
Observational trades, a term used within the industry, refer to trades made by a trader-trainer in real-time, which are then copied by their channel subscribers. While trader-trainers often defend this practice as merely for "observation" and learning purposes, it is clear that many subscribers interpret these actions as investment advice and replicate the trades.
Kar further revealed that he lured subscribers to his Telegram channels, disguised as learning platforms, using three methods. One approach was selectively highlighting profitable trade days, analyzing those trades, and then inviting viewers to join the premium Telegram group for access to similar insights and trading recommendations.
The term "premium group" is commonly used by trader-trainers to describe Telegram groups that offer paid access to stock advice and trading calls.
In the conversation, Kar disclosed that he collaborated with Rigi, a content creator platform, to combine his training and mentoring programs, which garnered significant attention. He explained that anyone joining a mentoring program would gain access to training videos, a move that was perceived as receiving both training and personalized mentoring.
Market insiders have pointed out that mentoring programs typically go beyond explaining general stock market concepts and allow student-subscribers to follow the trader-trainer's live trades, effectively providing investment advice.
On May 29, Rigi made it mandatory for any influencer selling content related to the securities market to register with SEBI as a research analyst or investment advisor. In response to queries from Moneycontrol, Rigi clarified that prior to this announcement, Abhishek Kar utilized a Telegram channel as an extension of his educational courses offered through Rigi. They emphasized that the content within Kar's Telegram channel was his sole responsibility, and Rigi served as a facilitative platform without control or oversight over the content.
Following the announcement, Rigi restricted services related to Kar's Telegram channel to comply with their updated guidelines aimed at maintaining platform integrity. However, Rigi maintains that they operate within the IT/ITeS sector and do not fall directly under SEBI's regulatory framework. Their primary role is to provide tools for content creators to engage and monetize their audience.
This revelation has raised important questions about the regulation and transparency of financial influencers and the urgent need for accountability in the financial advice industry. Investors and traders are reminded of the significance of verifying the qualifications and credibility of individuals providing investment advice to make informed decisions.
Abhishek Kar, with a substantial following of over 1.5 million on various social media platforms, is now facing scrutiny for his actions. Despite being a sought-after guest speaker at prestigious institutions like the Indian Institute of Technology (IIT) and the Institute of Chartered Accountants of India (ICAI), it appears that Kar had been using his influence to promote his trading courses by providing investment advice.
In an audio recording that has been widely circulated online, Kar can be heard confessing to the use of coded language ('B' and 'S') to convey "buy" and "sell" recommendations. This admission raises concerns as Kar is not a registered financial advisor, and thus, offering investment advice without proper registration is a clear violation of SEBI norms.
During a conversation with Shreyas Bandi, a veteran trader and a figure known for debunking financial myths, Kar attempted to justify his actions by stating, "I was never writing 'buy' or 'sell' on my Telegram channels, only giving 'B' or 'S,' but yes, technically it means more or less the same."
This revelation has triggered an online campaign aimed at holding trader-trainers like Abhishek Kar accountable for their actions. Trader-trainers have often been criticized for enticing individuals with the promise of substantial earnings from trading, despite knowing the risks involved. Consequently, various platforms have urged trader-trainers to provide verified profit-and-loss statements as evidence of their claims, a request that has met with resistance from many in the industry.
The conversation between Bandi and Kar sheds light on the illegal practice of unregistered individuals providing investment advice to foster the rapidly growing "training" business. Kar admitted that he initially started his Telegram group by sharing charts but later turned to "observational trades" to attract more subscribers.
Observational trades, a term used within the industry, refer to trades made by a trader-trainer in real-time, which are then copied by their channel subscribers. While trader-trainers often defend this practice as merely for "observation" and learning purposes, it is clear that many subscribers interpret these actions as investment advice and replicate the trades.
Kar further revealed that he lured subscribers to his Telegram channels, disguised as learning platforms, using three methods. One approach was selectively highlighting profitable trade days, analyzing those trades, and then inviting viewers to join the premium Telegram group for access to similar insights and trading recommendations.
The term "premium group" is commonly used by trader-trainers to describe Telegram groups that offer paid access to stock advice and trading calls.
In the conversation, Kar disclosed that he collaborated with Rigi, a content creator platform, to combine his training and mentoring programs, which garnered significant attention. He explained that anyone joining a mentoring program would gain access to training videos, a move that was perceived as receiving both training and personalized mentoring.
Market insiders have pointed out that mentoring programs typically go beyond explaining general stock market concepts and allow student-subscribers to follow the trader-trainer's live trades, effectively providing investment advice.
On May 29, Rigi made it mandatory for any influencer selling content related to the securities market to register with SEBI as a research analyst or investment advisor. In response to queries from Moneycontrol, Rigi clarified that prior to this announcement, Abhishek Kar utilized a Telegram channel as an extension of his educational courses offered through Rigi. They emphasized that the content within Kar's Telegram channel was his sole responsibility, and Rigi served as a facilitative platform without control or oversight over the content.
Following the announcement, Rigi restricted services related to Kar's Telegram channel to comply with their updated guidelines aimed at maintaining platform integrity. However, Rigi maintains that they operate within the IT/ITeS sector and do not fall directly under SEBI's regulatory framework. Their primary role is to provide tools for content creators to engage and monetize their audience.
This revelation has raised important questions about the regulation and transparency of financial influencers and the urgent need for accountability in the financial advice industry. Investors and traders are reminded of the significance of verifying the qualifications and credibility of individuals providing investment advice to make informed decisions.
