SEBI directs impounding Rs 601 crore from Avadhut Sathe in interim order

The noticees have also been prohibited from offering any investment advisory or research analyst services, conducting stock-market training that involves live trading or stock-specific guidance, or issuing any stock-related communication through social media, WhatsApp groups or other platforms.

SEBI has issued an ex-parte interim order-cum-show cause notice against Avadhut Sathe Trading Academy Pvt. Ltd. (ASTAPL), its founder Avadhut Dinkar Sathe and director Gouri Avadhut Sathe, alleging that the academy carried out unregistered investment advisory and research analyst activities while presenting them as stock market education. The 125-page order, passed by Whole Time Member Kamlesh C. Varshney, follows a detailed examination for FY24 and subsequent search-and-seizure operations conducted at the noticees’ premises on August 20–21, 2025.

In the order, the regulator stated that despite an Administrative Warning issued in March 2024 for misrepresentation and selective disclosures, the academy continued to publish misleading promotional content showcasing only successful trades of course participants. Several complainants alleged that the training programs promised extraordinary returns but resulted in substantial losses, and that the academy conducted live market trading sessions where direct trade recommendations were given. SEBI’s analysis of video recordings found that specific stocks, targets, stop-loss levels and directional views were routinely provided during live classes, with Avadhut Sathe also displaying his own MTM positions. Participants were seen acknowledging that they had taken trades based on his suggestions.

The investigation further revealed that multiple private WhatsApp groups, created for mentorship batches with fees of up to Rs 6.75 lakh, were used to share stock recommendations, option strategies, entry and exit levels, and index forecasts. SEBI noted that such conduct amounted to providing investment advice without registration, and that the continuous inducement, the nature of stock-specific instructions and the scale of fees collected from participants established a prima facie violation of the SEBI Act, the Investment Advisers Regulations, the Research Analysts Regulations and the PFUTP Regulations.

In view of the findings, SEBI has imposed interim directions restraining ASTAPL, Avadhut Sathe and Gouri Avadhut Sathe from accessing the securities market, either directly or indirectly. They have been barred from buying, selling or dealing in securities until further orders, except for liquidating their existing holdings. The noticees have also been prohibited from offering any investment advisory or research analyst services, conducting stock-market training that involves live trading or stock-specific guidance, or issuing any stock-related communication through social media, WhatsApp groups or other platforms. SEBI has directed them not to divert or dissipate any funds collected from investors and to keep such amounts in an escrow account. SEBI has also directed the impounding of Rs 5,46,16,65,367 identified as prima facie unlawful gains, and required that this amount be placed in fixed deposits within 15 days with a lien marked in favour of SEBI.

Additionally, banks have been instructed not to permit any debit transactions from the accounts of the noticees without SEBI’s permission, other than transfers into the lien-marked deposits. They have further been asked to furnish details of all bank accounts, assets, liabilities, fee collections and the complete list of clients or course participants within 15 days.

The order also proposes that the noticees may be held jointly and severally liable for disgorgement of the fees collected through the unregistered advisory activities. They have been asked to show cause as to why such final directions, including monetary penalties (Rs 601 crore along with interest) and refund obligations, should not be issued in the next 21 days. The interim directions will remain in force until SEBI completes its proceedings and passes a final order.