SEBI clamps down on SMS scam, phoney stock advisers

In a crackdown on entities offering unsolicited and ill-informed stock tips to investors through short message services (SMSs) via mobile phones, the Securities and Exchange Board of India (SEBI) has debarred Imtiyaz Hanif Khanda and Vali Mamad Habib Ghaniwala from accessing the market and directed them to stop acting as investment advisors and portfolio managers with immediate effect. They have been asked to immediately withdraw and remove all advertisements, representations, literatures, brochures, materials, publications, documents and websites in relation to their investment advisory and portfolio management activities or any unregistered activity in the securities market. The SEBI said it noticed that certain entities were offering intra-day tips and stock advisory services to investors through SMSs and as part of its investigation, it obtained details of the call data records of the telephone numbers used for sending such SMSs. The SEBI conducted a surprise visit and went to the premises of Imtiyaz Hanif Khanda and Vali Mamad Habib Ghaniwala who, through their proprietary concerns Right Trade, Sai Traders, Bull Trader and Laxmi Traders, were found to be providing investment advice without being registered with SEBI. SEBI also found out that Right Trade was soliciting business of portfolio management services from the general public without being registered as a portfolio manager. “The entities had also made misrepresentations by making unrealistic claims, false statements such as having office in various countries, FII-based calls, jackpot calls and the like and they also made representation in a reckless and careless manner in their messages and website suggesting facts which are not true,” the SEBI said in an order.