The Securities and Exchange Board of India (SEBI) has launched a significant investigation into an alleged scam by Asmita Patel Global School of Trading (AGSTPL), led by popular YouTuber and self-proclaimed stock market expert Asmita Patel. This move highlights the growing issue of fraudulent schemes disguised as educational content in India's stock market. SEBI has frozen around Rs 54 crore of AGSTPL’s assets while investigating nearly Rs 104 crore in allegedly ill-gotten profits. Patel’s aggressive marketing and misleading claims of guaranteed returns lured retail investors, many of whom were pressured to take loans to enroll in her courses.

Stock Market Scams on the Rise in India

The Indian stock market continues to be a hotspot for scammers posing as financial experts, preying on retail investors' aspirations for wealth and success.

In recent years, scams ranging from fraudulent apps like Mahadev App to dubious self-styled 'market gurus' such as the Baap of all charts have repeatedly surfaced.
These scams typically involve creating a hype around trading strategies, leveraging social media platforms to build trust and legitimacy among unsuspecting investors.
The latest example is the case of Asmita Patel, whose educational institute allegedly exploited retail investors through unauthorized advisory services.

Why SEBI Is Investigating Asmita Patel

SEBI’s probe into AGSTPL has revealed that the institute operated without proper investment advisory licenses while pushing retail investors into risky trades.

AGSTPL aggressively marketed courses under names like MPAT (Master’s in Price Action Trading), LMIT (Let’s Make India Trade), and Options Multiplier (OM).
These courses were not cheap. The MPAT course alone was priced at Rs 8.26 lakh, creating financial strain for many participants.
SEBI found that the institute offered investment advice disguised as educational services without obtaining the necessary regulatory approvals.

Exploitation of Investor Vulnerability

AGSTPL allegedly manipulated students and investors by making unrealistic promises of high returns, even urging them to liquidate assets and borrow money to join the courses.

According to SEBI, individuals were told to sell their mutual fund holdings, gold, or other investments to fund their enrollment.
In some cases, participants were asked to take loans from banks, friends, and family to generate capital for trading.
This exploitation was part of a broader strategy to funnel participants into trades suggested by AGSTPL through private communication channels such as Telegram, Zoom, and email.

Creating Artificial Hype Through Social Media

AGSTPL used social media platforms to create a deceptive perception of success, removing negative feedback and promoting success stories.

Patel and her team allegedly curated their online presence by deleting unfavorable reviews, presenting a sanitized image of the business.
Participants were led to believe that AGSTPL’s methods were infallible, with Patel allegedly promising guaranteed returns on investments made through the courses.
The firm’s marketing efforts painted an image of financial independence and rapid success, exploiting investor optimism.

Questionable Broker Partnerships

SEBI’s investigation also uncovered questionable practices involving broker affiliations, where participants were pushed to open accounts with specific brokers linked to AGSTPL.

Patel reportedly had partnerships with brokers such as ABC Ltd. (name disguised) and was registered as an authorized person for these brokers.
Investors were required to execute trades under the firm’s direction, effectively turning them into instruments for AGSTPL’s gain.
SEBI alleges that AGSTPL monitored participants’ real-time trading activities under the guise of “handholding” them during course sessions.

The Financial Toll on Retail Investors

The fallout from AGSTPL’s practices highlights the vulnerability of retail investors in India’s rapidly growing stock market ecosystem.

Many participants, drawn in by the allure of quick returns, have reportedly suffered significant financial losses after being pressured to invest large sums.
The aggressive tactics employed by AGSTPL have drawn parallels to other scams in the market, where high-pressure sales techniques and misleading claims have devastated investors.
SEBI’s intervention aims to safeguard market integrity by cracking down on such deceptive practices and ensuring compliance with regulatory norms.

The Role of Regulatory Measures

SEBI’s actions against AGSTPL reflect the regulator's broader efforts to combat unauthorized investment advisory services and protect retail investors.

SEBI has intensified its focus on investment frauds, particularly those targeting financially inexperienced individuals.
The case underscores the need for stricter enforcement of investment advisory regulations and greater awareness of fraudulent schemes among the public.
By freezing assets and issuing show-cause notices, SEBI seeks to deter similar scams and reinforce trust in India’s financial markets.

Lessons for Investors

Investors must exercise caution when engaging with self-proclaimed market experts, particularly those offering high-priced courses with promises of guaranteed returns.

Verify Regulatory Compliance: Ensure that any investment advisor or trading course provider is registered with SEBI or other relevant authorities.
Avoid High-Pressure Sales Tactics: Be wary of schemes that urge participants to liquidate assets or take loans to invest.
Research Before Investing: Conduct thorough due diligence on both the institution and its promoters. Avoid platforms that rely heavily on curated success stories or remove negative feedback.

SEBI's Investor Protection Measures

The case of Asmita Patel and AGSTPL serves as a stark reminder of the risks associated with unregulated investment advisory services. While SEBI’s crackdown aims to protect retail investors and reinforce market integrity, individuals must remain vigilant against fraudulent schemes. By promoting transparency, enforcing compliance, and raising awareness of financial scams, India’s regulatory framework can continue to foster a more secure and trustworthy investment environment.