SEBI Shock: What’s Behind the Action Against Avadhut Sathe Trading Academy? Full Breakdown of Allegations & Evidence
The Securities and Exchange Board of India (SEBI) has issued an Ex-Parte Interim Order-cum-Show Cause Notice in the matter involving Avadhut Sathe Trading Academy Private Limited (ASTAPL) and Avadhut Dinkar Sathe, widely known in the trading education community. The order, signed by SEBI Whole-Time Member Kamlesh C. Varshney, brings serious regulatory scrutiny over activities conducted between FY 2023–24 and the extended investigation period July 1, 2017 to October 9, 2025
The SEBI order alleges that the academy conducted unregistered investment advisory activities under the guise of trading education, misrepresented profitability claims, and provided securities-specific trading recommendations through live market sessions and WhatsApp groups.
This action has triggered intense discussion in the Indian trading community and sparked questions about the future of financial education and regulatory compliance.
Why SEBI Initiated Action
According to the SEBI document, an examination found that the academy:
- Published selective profitable trades of participants and claimed consistent returns
- Suggested that its trainers were experts while, according to SEBI, analysis revealed net losses for trainers and participants
- Received an administrative warning on March 1, 2024, but allegedly continued publishing misleading promotional content
Following additional complaints, SEBI concluded that the activities appeared to involve:
“Unregistered investment advisory and research analyst services under the guise of stock market education”
Search & Seizure: Key Timeline
| Date | Event |
|---|---|
| July 24, 2025 | SEBI appointed Investigating Authority |
| August 18, 2025 | Special Court approved search operations |
| August 20–21, 2025 | Search & seizure conducted at academy premises & residences |
| Post-search period | SEBI received more complaints regarding alleged misleading practices |
Who Are the Noticees?
| Entity | Role |
|---|---|
| Avadhut Sathe Trading Academy Pvt. Ltd. | Training platform |
| Avadhut Dinkar Sathe | Promoter / Trainer |
| Gouri Avadhut Sathe | Director |
SEBI notes that none of the entities or individuals were registered as Investment Advisors or Research Analysts as required by regulation.
Courses & Fees Identified by SEBI
The order lists several paid programs with fees ranging from ₹500 to ₹6,75,000 including SMM, PAPA, FOME, GUE, Mentorship etc. ORDER_1764842991
| Course Type | Fee |
|---|---|
| Eye-Opener webinar | ₹500 |
| GEO Flagship programs | ₹72,000 |
| GEO Plus | ₹1,70,000 |
| Mentorship Program | ₹6,75,000 |
The investigation was partly to determine whether high-fee courses involved implied promises of financial success.
Key Allegations from Complaints (as per SEBI order)
The SEBI document details multiple allegations from complainants including:
- Live market sessions where exact trade calls, stop-loss and targets were given
- Sharing live trading positions & MTM gains to influence students
- WhatsApp-based trade signals disguised as chart study
- Selective display of profitable trades
- Testimonials implying large earnings, including use of a 12-year-old child in promotions
- Encouraging participants to take loans to pay course fees
Video Evidence SEBI Analysed
SEBI reviewed seized recordings showing real-time stock recommendations, price predictions, and actionable buy/sell orders including stop-loss and targets.
Examples cited in the order include live discussions on specific stocks such as:
- Power Finance Corporation Ltd. trades with entry, stop-loss and target guidance
- ICICI Bank, SRF, Kotak Bank, Reliance, ONGC, Natural Gas Futures etc.
- One participant confirming taking position based on trainer’s recommendation ORDER_1764842991
According to SEBI:
The communication format functioned like actionable investment advice rather than educational theory. ORDER_1764842991
WhatsApp Evidence
SEBI identified multiple WhatsApp mentorship groups with 120-150 members each where:
- Entry / stop-loss / price targets were shared
- Trend predictions and MTM screenshots were posted
- Specific stock recommendations were issued ORDER_1764842991
Example messages cited:
- “Power Grid likely to make all-time high, PFC great entry near 160”
- “NMDC next stop 164”
- “If range breaks Natural Gas to 354”ORDER_1764842991 .
Prima Facie Findings by SEBI
SEBI states in the order:
“It is prima facie established that the nature of activity carried out by ASTAPL/AS are more in the nature of investment advisory/research analyst.” ORDER_1764842991
The document also claims:
- Assured-type return statements were made
- Capital allocation suggestions were given (e.g., percentage of FD to invest)
- Participants were encouraged to mimic trades
Regulations SEBI States May Be Violated
- SEBI Act, 1992
- Investment Advisers Regulations, 2013
- Research Analysts Regulations, 2014
- Prohibition of Fraudulent & Unfair Trade Practices Regulations (PFUTP)
An interim ban is proposed preventing the academy and individuals from:
- Accessing securities markets
- Soliciting or providing investment guidance
Pending final outcome, they have been asked to provide responses and evidence.
What This Means for Retail Traders
Key Lessons
| Lesson | Why it matters |
|---|---|
| Do not rely on free/paid tips | Legal compliance required |
| Trading education ≠ stock advisory | Different regulatory categories |
| Avoid emotional investing | Marketing can influence psychology |
| Verify SEBI registration | Protect assets from risky guidance |
Impact on India’s Trading Education Industry
This case may accelerate:
- Regulation of financial influencers
- Clarity on advisory vs training
- Transparency expectations from academies
Analysts expect more SEBI action across the education ecosystem as retail participation grows.
Conclusion
The SEBI Order does not determine guilt — it is an interim order and a show-cause notice, giving the opportunity for response before final judgment.
However, based on the interim findings, SEBI states that there is prima facie evidence suggesting unregistered advisory practices.
This case serves as a wake-up call for:
- Retail traders relying on personality-driven trading guidance
- Coaches & academies offering profit-oriented education
- Investors seeking financial literacy
The final outcome will likely define the future boundaries of online trading education in India.
