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SEBI has urged investors to exercise caution and due diligence before making investment decisions on any unsolicited financial advice.
This has come after SEBI found that many individuals and entities claim to be registered with SEBI as intermediaries to offer financial advice. These entities often entice public by showcasing fake certificates and promising assured and high returns.
SEBI said, “It is imperative for investors to understand that investments offering high returns usually involve high risk including fraud risk and there can be no guarantees of assured returns in the securities market.”
SEBI gives some actionable tips to verify such claims:
- Investors can verify SEBI registration status on SEBI website by following this flow chart - → www.sebi.gov.in → Intermediaries / Market Infrastructure Institutions → Recognised Intermediaries.
- Investors should beware of promises of high returns as higher returns come with higher risks of losing money all together
- Investors can also check if SEBI has taken any action against such entities. Visit www.sebi.gov.in → Enforcement → Orders
Finally, SEBI said that investors should keep themselves updated. Knowledge is your best defense against fraud. Visit SEBI's investor education website at https://investor.sebi.gov to brush up knowledge.
