Securities and Exchange Board of India (Sebi) chairman Tuhin Kanta Pandey has dismissed allegations of a “regulatory vacuum” made by Avadhut Sathe Trading Academy (ASTA), a day after the regulator barred the firm and its founder from participating in the securities market.
“There is no regulatory vacuum; there is a lack of understanding because the regulations clearly state that you cannot give stock-tip advice,” Pandey said at a National Stock Exchange (NSE) event.
His comments follow Sebi’s toughest action yet against a finfluencer entity. On Thursday, the regulator issued an interim ex-parte order banning Avadhut Sathe and ASTA for allegedly acting as unregistered investment advisers and generating illegal gains of ₹546 crore.
According to Sebi, the academy blurred the boundaries between education and actionable trading advice. Searches conducted at ASTA’s premises and at the homes of Sathe and his wife in August allegedly revealed “live trading rooms” where participants received real-time intraday cues, buy/sell levels, stop losses, resistance points and strategy directions. Sebi said recordings showed students acting instantly on Sathe’s prompts.
The regulator also examined the trading performance of trainees for six months after completing ASTA’s mentorship programme, priced at ₹6.75 lakh. Of the 311 participants, Sebi matched PAN details for 186, who collectively lost ₹1.93 crore. ASTA reported losses of ₹1.89 crore, while Sathe booked personal trading losses of ₹4.31 crore over FY24–25 and FY25–26.
ASTA, however, insisted it was “a victim of regulatory vacuum”, claiming it does not offer stock tips or recommendations and uses market examples solely for “conceptual clarity.” It said it would legally challenge the order.
“We are a victim of a regulatory vacuum and do not fall under the category of research analyst or investment adviser,” an ASTA spokesperson said on Friday.
Pandey also warned against misuse of real-time market data under the guise of education. “Live data should not be used at all for educational purposes,” he said.
He pointed to a broader issue in the ecosystem: regulated intermediaries such as registered investment advisers and research analysts are prohibited from publicising their performance track records, while unregistered entities freely make unverifiable claims.
To address this gap, Sebi launched the pilot of the Past Risk and Return Verification Agency (PaRRVA), a first-of-its-kind framework that independently authenticates historical returns of investment advisers, research analysts and brokers offering algorithmic trading services.
The system connects a Sebi-registered credit rating agency acting as PaRRVA with a recognised stock exchange functioning as the PaRRVA Data Centre. Verified data will follow a standardised, transparent methodology, and intermediaries will not be allowed to highlight returns for specific products or strategies. An oversight committee will monitor compliance and data integrity.
“With the launch of PaRRVA, India will be setting a new international benchmark for transparency, accountability and investor protection,” Pandey said, adding that the mechanism is expected to help shift investors back toward regulated intermediaries who currently face constraints on showcasing legitimate performance.
